This is a huge win for the developers, despite that pesky warning. They can still ask users to circumvent apple pay/in-app purchases and get away by not giving a revenue cut to Apple.
Contractually, developers are still required to pay 27% commission to Apple (or 12% for the small business programme). i.e. Apple are only removing a 3% payment processing fee here.
They say it'll be hard to actually audit this, and it will, and many developers may manage to get around it, but technically that's a breach of contract and they could be removed from the store for it, so I'm sure many won't risk it.
What about sketchy apps with subscriptions, are those still managed via Apple? As an end user, I like the fact I can just cancel through Apple instead of having to find my way around a 3rd party site that is trying its best to prevent me from unsubscribing.
This change means that users could go and subscribe externally, including to scam subscriptions, and you would no longer be able to cancel via Apple. That's probably part of the motivation for why they don't want to implement this sort of thing.
That’s been one of their arguments against it. You’re right. And honestly they’re not wrong.
It wouldn’t surprise me if using a non-Apple payment system quickly became a very good way to figure out if you were about to get scammed by a random third party.
If it’s a company that I already know and trust, I might be willing (though Apple payments will still be more convenient).
Rando company? No way. Honestly this whole thing is probably going to prove their point. Even if they don’t exactly deserve the win.
It's beyond a joke. Between that and the payment processing fees, you're no better off. In fact, you get all of the same costs but none of the benefits of Apple's app store native payment infrastructure.
It seems a lot more egregious that anything Microsoft did in the 90s. While MS tried to push their own products and lock out competitors, they never tried to take a massive cut of all the software on their OS. The level of sheer FU everyone chutzpah is pretty impressive.
They're indeed making quite a joke out of antitrust at this point.
I'm not sure that's a direct comparison. Back then sure you could get shareware but mostly the market was paid boxed software. I can't find a direct source but I remember hearing brick-and-mortar retailers would take even more than 30% of sales. And Visual Studio sure wasn't free.
Everything was different though, you'd be paying for your OS upgrades too which doesn't happen on iOS. I agree 30% is crazy, but the market on iOS they're enabling has to get paid for somehow. That source of revenue was different for Microsoft in the 80s/90s but it still existed.
Throughout the multiple trials that has been a big argument Apple makes. That especially for smaller companies their cut is drastically lower than it would have been for retail software on shelves.
Which conveniently ignores the fact that you can buy software for digital download on the Internet for significantly lower overhead.
> buy software for digital download on the Internet for significantly lower overhead
But you are looking at that through the lens of an end user.
As a developer, Apple's total acquisition cost i.e. 15/30% is far less than what it costs me to acquire customers through other channels e.g. Paid Ads, Referral etc.
I used to sell shareware back in early 2000s and have never sold a box, only online. There used to be payment processors tailored just to this, who were charging way less than 30% for the privilege.
> but the market on iOS they're enabling has to get paid for somehow
How about paying for it with the massive profit they make selling the devices?
As far as I can tell, the only reason Apple’s doing the whole rent-seeking App Store business is “because they can.” Upside is all that money, downside is the developers kinda hate you.
Apple has 50%. Courts have already ruled they’re not a monopoly. Epic asked the Supreme Court to look at that again and they specifically decided not to and to leave the decision in place.
That’s why Apple can do what they’re (now, post order) doing legally and Microsoft couldn’t.
iOS and Android taken together are clearly a monopoly though. So call it a cartel or duopoly with price fixing if you like rather than a monopoly. It's exactly the kind of situation that antitrust laws were created to prevent.
Unless you can find proof of collusion I’m not sure it matters.
Making matters worse the Google Play Store is completely optional you’ve been able to side load for years. To the degree Google prevented that they just got kicked in the teeth for it.
So you’re going to have to argue that the combination of the Apple App Store, plus Google, plus Samsung, plus everything else all work together to screw over users.
> iOS and Android taken together are clearly a monopoly though.
That's deceptive language that undermines your argument.
A monopoly is a market with the "absence of competition", creating a situation where a specific person or enterprise is the only supplier of a particular thing.
If you said "duopoly" your argument would be more easily entertained or if you said "cartel". However, neither of these two characterizations stand up to scrutiny either.
Apple is acting like a state within their domain. Collecting a VAT and requiring compliance that's reserved usually for the national tax office with inspective powers.
Having locked in the richest consumers of the world, they get to say what goes and what doesn't, worldly courts and laws be damned.
It's both hilarious and gruesome at the same time, because we're supposed to be equal under consumer laws or whatever, but there you go!
The infuriating part is that this isn’t about computing or distribution. They already charge for that separately. It’s a triple dip just because nobody stops them.
Most of the modern digital consumer economy is based on products and services which are device-agnostic. If I’m using Spotify or Netflix or something they are service providers and the iPhone/ipad is just a client device. Apple should have no marginal returns (a cut) on money that should go to artists, actors, developers. They’ve already charged massively for both their physical products and their services.
Antitrust law is a joke. This has always been glaringly obvious since Jobs first came up with this shit. The fact that it still ain’t fixed is a travesty, not just for tech nerds, but it impedes the digital economy at large.
The greediest thing of it all is that they’re actually providing a service people would pay premium for - in-app purchases and their “all subscriptions in one place” without dark pattern harassment is very nice for consumers. They have a legit product worth a ton yet they still refuse to compete fairly. Anti-market capitalism..
> Apple is acting like a state within their domain.
Someone unironically complained yesterday that developers who don't like paying the 30% fee probably don't like paying their taxes, and I made the exact same argument that Apple was acting like a sovereign state [0]. And now Apple is doubling down by announcing that they'll be performing financial audits just like the Internal Revenue Service if you include a link to purchase content/services outside of the app store.
> Apple’s commission will be 27% on proceeds you earn from sales (“transactions“) to the user for digital goods or services on your website after a link out (i.e., they tap “Continue” on the system disclosure sheet), provided that the sale was initiated within seven days and the digital goods or services can be used in an app.
As any F2P gamer knows, “whales” don’t just spend up front - they make microtransactions on a regular basis for months or years as new rewards become available. This is incredibly meaningful for game publishers who depend on long-term customer engagement.
So Apple will be collecting 27% (instead of 30%) for... what exactly?
They might just get away with something as crass in a vacuum, but given that the DMA will go into effect very soon, there will be a point of reference in a similar economy, and I don't think it'll be pretty for Apple.
US regulators (federal or state; I could see something equivalent to GDPR and CCPA) will be taking a very close look.
> So Apple will be collecting 27% (instead of 30%) for... what exactly?
Off the top of my head...
- Bandwidth
- Running the App Store for users
- Marketing the App Store
- App review
- Security efforts to keep malware off the store
- Making App Store optimisation tools for developers
There's a lot of moving parts to this. You could argue that none of this is necessary if you sideload, but distribution is worth a lot in general to businesses, and I think it's clear that the App Store is a good distribution channel in many ways – easy to use for sellers (vs via traditional publishers, or physical retail), and easy to use for buyers.
If that's true (and I even believe that it is to a large extent!), there should be no problem for Apple to let its value proposition stand for itself and allow some competition.
Besides that, that list is very bundled. What if I e.g. want the convenient subscription payment processing, but want to (or need to) bring my own CDN for most content? What if I want their marketing and am willing to pay for it, but prefer my own payment processing?
I agree, although I think this is doing that to some extent. Sure there's some scary text in the popup that I think could be toned down, but I'm not an expert, and to be fair there are risks going externally.
Allowing other app stores would be the big win in competition here, properly forcing Apple to win on value proposition. The DMA could force this, but I'm not certain about the details.
The scary text doesn't matter nearly as much as the fact that they are not unbundling anything. They are charging an effectively equal/higher fee for less services than developers would get from just sticking with in-app purchases.
It's an arguably quite sloppy illusion of competition/choice.
So charge a fee based on usage of the specific services then? Flat 30% of monthly subscriptions when they're not even providing the service of sending that audio and video to the device is insane.
I agree, but I also don't know what actually would be a fair price for either of these specific services.
The advantage of mandating alternative distribution channels (i.e. sideloading or alternative app stores, both with their own payments infrastructure) would be that it wouldn't be up to a regulator to figure that out – the market could decide.
Sure, all these things cost a lot of money. What if I would like to market, host, and distribute my own app, without any Apple involvement?
From my own experience, the app store brings negative value to both the users and the developers in many cases. It's most often seen not as the godsend like Apple portrays it, but as a stupid obstacle course that you need to clear every time you publish a new app or an update to an existing one, and sometimes even when you don't.
Digital distribution is much easier than burning discs, sending them to shops, etc. It's also not just the process but the visibility, a million tiny storefronts will be much harder for users to browse and likely result in fewer overall sales, than one massive storefront.
I get that there's no competition on iOS, but I was comparing to other ecosystems and mechanisms.
> So basically nothing that companies couldn't do themselves if Apple didn't explicitly block it. You pay 27% for fuck all.
No, you pay 27% for those services I mentioned. Those things aren't free if developers do them themselves. Developers may prefer to do some themselves because they think they can do them for cheaper, and in this case payments have been opened up so that there can be competition there – the DMA in the EU will do similar and I look forward to it.
You may disagree with the price (and I personally feel it's high), but these things cost real amounts of money to do. Not just this, but free app developers would also need to pay all these costs despite potentially having no revenue directly attributable to the app.
> You can probably include development of SDKs and documentation as well.
With limited exceptions, platform vendors (Microsoft, IBM, Sun/Oracle, etc) are generally not in the business of paywalling their development documentation, tools, and SDKs, otherwise it makes their platform far less attactive to third-party developers that they absolutely need in order to.
...and ever and never-mind that Apple's documentation is sub-par[1], even with the billions of dollars they're raking in. It boggles the mind because nothing is stopping Apple from hiring the people it needs to ensure decent documentation and DX, which can be paid-for directly from the $99/yr developer membership fee.
My company's SaaS product used to have an iOS and Android app which we discontinued a couple of years ago when Safari finally started supporting more web-standards that enabled our PWA to more-or-less have parity with the old app (confession: our app was using Xamarin instead of being truly native, not that it mattered much).
...so with that context in-mind, we don't benefit from - nor really need at all, most of those services you're referring to;
> Bandwidth
We're a small B2B SaaS with a userbase sized under 100,000 users and our old app bundle was around ~20MB and updated a handful of times per year, so even if 100% of our users used the iOS app with auto-updates then that's less than 2GB of data-transfer per published update - the cost of serving that is far less than a rounding-error on AWS/Azure.
> Running the App Store for users
I accept that.
> Marketing the App Store
No-one should be paying for Apple to market their own App Store - and as a B2B SaaS app, Apple would never promote us or do marketing for us.
> App review
I also accept this - but ostensibly this is what your $99/yr developer fee pays for.
> Security efforts to keep malware off the store
This is the same thing as App review; if we look more broadly, then it's better to compare this to Microsoft's Windows Defender which is free, and is funded independently of the Microsoft App Store.
> Making App Store optimisation tools for developers
Again, this is Apple's responsibility to pay for, not ours - and even-then consider that efficient update/patch distribution systems have been around for decades so it's hardly cutting-edge development (e.g. those ~KB-sized binary diff patches for CD-installed games in the late-1990s when we were on dial-up, like EA had for SimCity 3000 or C&C Red Alert 2)
For a B2B SaaS client app for BYOD users the iOS App Store is perfectly fine as a distribution system, and morally I'm fine with paying Apple some kind of fee for the benefits of their distribution system, but Apple has no legitimate claim to any percentage of the subscription fees we get from our users - so what this means is that we can make our app available for free to our users (which is fine, honestly) but (as per my understanding of the rules) we cannot offer any kind of account-management or billing-management for their SaaS subscriptions from within the app which isn't ideal.
I think Apple's main mistake here was deciding that having a single set of rules and fee-schedules/commission/etc for everyone, because the revenue models for exploitative mobile games (especially their gold/gems IAPs) differs massively from my company's unimaginatively dry B2B SaaS client.
> I think Apple's main mistake here was deciding that having a single set of rules and fee-schedules/commission/etc for everyone
On the other hand, non-equal fees ironically seem to be exactly what's made US courts decide in favor of Apple but against Google in two superficially quite similar cases regarding app store fees:
I think the main mistake isn't the fixed percentage fee, but rather holding on to the golden goose that is an app store monopoly for too long.
Google has been providing sideloading since day one for example, and except for a few high-profile exceptions, people do genuinely seem to prefer the platform's native app store.
Apple always aims for total control and authority over everything: Their supply chain, the apps running on their systems, the devices allowed to interface with them – and while that obsession with keeping it as *their own platform
arguably is part of what makes their devices attractive, I think it won't keep working forever in this case.
All of that can easily be funded by the margins Apple makes off device sales alone combined with the fees you pay to become a developer.
Even if for some reason you believe that's not true, there's no way they need 27% of all purchase revenue on the store to fund that stuff. The numbers simply don't check out. 30% was an arbitrary cut and that's why they can easily drop it to 27% or (for small devs as of recently) 15%.
In the situations we're discussing, both the app developer and every customer have already given apple hundreds if not thousands of dollars worth of revenue. Out of that, Apple has a healthy margin.
Now we're talking about Apple sticking their fingers into developers' pockets for every single transaction even if Apple's participation in that transaction is limited to updating a couple database rows to indicate that Customer XXXXX bought DLC Package YYYY in App ZZZZZ. There is simply no way that is worth 30%. They're not doing that much work.
In the EU has the 30% (or now 27%) been found illegal? I know they’re being forced to allow other app stores or side loading or something. But what about the fee?
For obvious reasons, the US government and justice system is probably not interested in being the beta tester for such a regulation – they have relatively little to gain and much to lose. Even "green bubbles" seem to be a much bigger point of contention in US public discourse than sideloading/the 30% tax.
But if the DMA it ends up working well well and consumers like it, and app store customers manage to sell that fact to the US voting population, the wind could change for Apple too.
I don’t think that really matters at all. No one (in the legislative branches) cares enough to pass something about this. Is basically impossible to get things past anyway recently, even far more important things than this.
Hurting one of its biggest companies for something that turns out to not be in the interest of the voting public after all would be kind of a big deal!
Even an ineffective regulation that neither hurts nor harms consumers but ends up hurting Apple would probably be seen very negatively.
> Is basically impossible to get things past anyway recently, even far more important things than this.
Very true, and another point in favor of inertia. The only thing that could possibly break that is seeing a similar regulation be a slam dunk in a comparable market, but even then it's a big if, I agree.
Yeah, I think the only way it is going to happen at this point is that if it proves successful in the EU then it’s quite possible we could get a law here in the US that basically says “we want that too or else“.
I just don’t see us leading (or going in parallel) due to lack of interest/will.
Well if they try any shady business here (e.g. forcing a fee, limiting competitors contractually, lot's of big scary warnings for everything) the EU is standing by for rounds two, three etc.
The regulatory rules passed in the DMA are written to allow action without the need to go through the whole legislative process.
I predict it will come to that. Apple is gonna fight this tooth and nail to the very end. And unless they change their attitude and business practices, Europe has very little too lose by piling more and more rules on them.
The 27% is not really a problem if there were a competitive market. If one emerges we'll see if not...see above.
I’m curious to see what happens in the EU. Apple could do a couple of things to make their life easy but I know they’re gonna go down kicking and screaming and make things worse for themselves. It’s what they always do.
<<
The DMA covers eight different sectors, which it refers to as Core Platforms Services (CPS). Due to the presence of gatekeepers who, to a certain degree, affect the market contestability, the CPS are considered problematic by the European Commission:
online search engines (e.g. Google Search);
online intermediation services (e.g. Google Play Store, Apple's App Store);
They are taking 27%, between that and processing fees you might as well use In App Purchases.
"Apple’s commission will be 27% on proceeds you earn from sales (“transactions“) to the user for digital goods or services on your website after a link out (i.e., they tap “Continue” on the system disclosure sheet), provided that the sale was initiated within seven days and the digital goods or services can be used in an app. This includes (a) any applicable taxes and (b) any adjustments for refunds, reversals and chargebacks. For auto-renewing subscriptions, (i) a sale initiated, including with a free trial or offer, within seven days after a link out is a transaction; and (ii) each subsequent auto-renewal after the subscription is initiated is also a transaction.]
If you’re a participant in the Small Business Program, or if the transaction is an auto-renewal in the second year or later of an auto-renewing subscription, the commission will be 12%.
These commission rates apply to all amounts paid by each user net of transaction taxes charged by you. You will be responsible for the collection and remittance of any applicable taxes for sales processed by a third-party payment provider.
If you adopt this entitlement, you will be required to provide transaction reports within 15 calendar days following the end of each calendar month. Even if there were no transactions, you’re required to provide a report stating that is the case. If the cadence changes, we will update this page. To learn about the details that will need to be included in the report, view example reports. In the future, if Apple develops an API to facilitate reporting, you will be required to adopt such API within 30 days with an update of your app and follow the timing and requirements provided."
This is in response to them losing that part of the Epic lawsuit and exhausting all appeals (SCOTUS denied cert yesterday). It's not a voluntary decision.
Depending on the payment method used, they might just make a profit on this (e.g. some cards charge more than 3% of interchange alone, and there's other fees on top).
True, although I’m not sure if Apple doesn’t pass that through to developers anyway (at least in terms of losing the purchase, if not the fees as well).
My feeling is that this is a half measure and any half measure allow for the "freedom of interpretations". AAPL will put a lot of road blocks around external purchase links (result of recent ruling). I expect apps that will use external purchase links to be scrutinize a lot more, unexpectedly take off from the AAPL app store for made-up reasons and myriad of other road blocks around the ruling. You know, AAPL needs it's 30% cut.
But court has also found their required to do this. So if there are roadblocks are onerous you know someone’s going to go running to the court to try and get that fixed.
They could end up in big trouble if they try and fight it too hard. But they’re also not gonna roll over.
Expect the same exact thing with the DMA changes in the EU.
This is not new. The 27% fee has been around for over a year now I think, may have been announced in 2021 even, for markets outside the US that already mandate this. I've seen these screens already in apps.
As GP mentioned it has been in effect for a while in Holland and maybe Korea or a few other places for at least certain kinds of apps due to local laws.
Interesting note: this only applies to the US. I know the EU is forcing changes as well, but those are EU only.
So South America, Asia, Australia, Africa, Canada, Mexico, and others haven’t changed one bit and likely still require 30%.
IIRC it was based on a court case from a group of dating app providers there. Dating apps have somewhat tricky unit economics, so I wouldn't be surprised if they made a case for their businesses specifically, and perhaps the court's finding was therefore not that widely applicable.
Demanding a 27% commission for transactions taking place entirely outside of Apple infrastructure is obviously a finger in the eye, but I'm not entirely sure whose eye yet. Epic? The court? The FTC? The developer community? All of the above?
I love how apple has provided suggested language, such as "To get [X%] off, go to [X]", knowing damn well that a discount would only be offered if they weren't collecting a commission.
Add to that that the link can only be displayed on a single page (not a modal or popup) and cannot be part of a purchase flow (where else would it go?). Certainly a huge slap in the face to all developers and the court's intent.
They also say that using parameters in the URL is a privacy concern, when the real reason is they don't want you to use some kind of one-time-link to log the user in. They want the user to have to log in again, making it as painful (and least likely to convert) as possible.
Remember that Apple charges 15% for everyone making less than 1M in revenue. And the range applied for external processing is going largely correlate with Apples offerings.
Apple doesn’t see their cut as “payment processing and hosting”. They see it as the cost of selling for their platform.
This appears to be a huge boon, due to the fact that developers can now send their external marketing directly to their own online landing/checkout pages. Apple appears to be only charging commission for traffic sent there and that checks out within 7 days of clicking the in app link.
In other words, a developer can have a Facebook ad or similar go directly to the checkout page and buy the app there, bypassing the app store commission for traffic the developer is bringing to the app store themselves. Feel free to correct me if I'm wrong on this.
This being the case, any recommendations for carts / processing services / etc that would be ideally positioned for this kind of use are MASSIVELY welcome!!!
If we’re talking about the details of the implementation, maybe.
If it’s about the commission that still needs to be paid, then no. That’s directly mentioned in the original ruling by the district court, a commission is due regardless.
I think the real problem is unlimited access to accounting books for any business that has an iOS app. This will affect free apps too, since they now have the potential to offer purchases outside the app store. (Obviously, strategic partners and FAANG are exempt.)
In theory, perhaps, in practice Apple will only audit the developers that use the special entitlement.
Ironically, this is something that is bothering the appellate court as well if you read between the lines of their judgment[0].
They gently criticize the district court for both saying that developers should be able to link and sell outside the app while simultaneously saying that it’s undesirable for Apple to audit developers because it’s too cumbersome.
But the appellate court isn’t meant for do overs, just for when courts have erred in a significant way, so they only gently lament this, instead of doing something about it.
The difference between the Apple and Google lawsuits (from what I can tell), is that Apple didn’t exempt FANG and held them to the same terms as everyone else while Google made private deals with special terms for individual businesses (Spotify was one, IIRC) that were not available to all customers.
This is not particularly unusual for royalty licensing scenarios. As a matter of fact Epic's Unreal Engine EULA has a similar clause:
You agree to keep accurate books and records related to your development, manufacture, Distribution, and sale of Royalty Products and related revenue. Epic may conduct reasonable audits of those books and records. Audits will be conducted during business hours on reasonable prior notice to you. Epic will bear the costs of audits unless the results show a shortfall in payments in excess of 5% during the period audited, in which case you will be responsible for the cost of the audit.
> Apple is already pretty clear in its developer agreement [0] that the 30% commission is for "its services as Your agent and/or commissionaire" (Schedule 2 3.4), not for its services as a payment processor. They are contractually allowed to take the 30% fee out of payments collected, but merely using a different payment processor doesn't remove the obligation to pay them for their other "services as Your agent and/or commissionaire".
> Yvonne-Gonzalez was skeptical of the 30% fee during the trial, and in the ruling she was suspicious about Apple's justification of the commission, writing that "the 30% is not tied to anything in particular and can be changed," but did not order Apple to do so.
> It'll probably need to be another lawsuit since it's in the developer agreement.
Mind you, you can be blocked from doing needed Apple dev stuff (eg sign binaries, etc) until you've manually logged into your Apple account and clicked on the "I accept" button whenever they change terms.
This happened to us (sqlitebrowser.org) in recent weeks, as our CI just stopped working one day.
It turns out there was a new developer agreement that needed signing, and until I'd logged in and done that then Apples servers would no longer sign binaries.
There's literally no choice but to sign the things - regardless of terms - if you want your users to have software that runs.
>There's literally no choice but to sign the things - regardless of terms - if you want your users to have software that runs.
This gets to be a real nightmare in large organizations with multiple Apple Dev Portal admins, some of which may not even be authorized to sign legal documents on behalf of the company.
It’s a pain even in small orgs. There are some things only the account owner can do. You can make someone else an admin with every possible authorization, and if the person who set up the account is tied up or out of office, a whole dev team and testing can be stopped.
It's a massive pain when working with non-technical entities. Both professionally and in my side-business I have to do this and it's a horrible experience. I'll pay the damn $99/yr, just let me admin everything for the client. Tracking down the owner and getting them to login and click a button is harder than it sounds and it brings updates (even internal on TF) to a screeching halt.
EU already forbids consumer contracts from e.g. having the business force a change of terms (though ending the contract on disagreement might count as good enough behavior).
I suspect if the EU courts consider denying access to a website if they refuse GDPR permissions illegal they'll probably consider ending a contract based on not accepting new terms as forced.
Doesn't sound interesting at all, as the two matters are unrelated.
Apple isn't charging for use of the iOS platform SDKs; the developer agreement is much more vague and weasely about what they're charging for, being the developer's "agent and/or commisionaire".
Per-sale licensing for a copyrighted (or patented) work is pretty normal and done in many industries. Apple's agreement doesn't specify any fees for licensing at all.
Moreover, if they would actually admit what they were nominally charging for then someone could create a third party implementation of whatever that is, people would want to be able to use that instead of paying the fee, and what is their excuse supposed to be then?
The case has been about whether preventing others from competing on pricing is anticompetitive not whether having pricing should be illegal in itself. Whether that's about the App Store or the SDK it would be extremely odd to suddenly expect Epic to instead try to argue it's the payment model that's the problem not the anti-competitiveness of only allowing 1 option.
To add, I'm not sure what legal basis there is for "you're charging too much". My only guess is filing against Apple and Google jointly for being a duopoly, but Epic has made it extremely hard to do something like this because of their existing jury trial against Google which gives a lot of concessions to third-party app stores in terms of functionality.
"You're charging too much" seems unlikely to be the actual argument presented though. Something along the lines of the scare message, still not actually allowing it to be handled via in app flow like a first party payment, and intentionally making a 3rd party choice potentially impossible to compete vs a 1st party choice by arguably hiding part of the processing fee margin in the overall fee would be the kinds of arguments I'd expect.
I.e. Epic's goal here isn't about whether Apple charges 99% or 1% rather it's about allowing other payment methods (theirs in their case of course) to compete with equal footing regardless what Apple wants to charge to do it through them instead.
I think the percentage charged is very relevant though.
And the fact the developer is to hide the fee and not list it on the receipt (subscription: $10, Apple tax: $3)
And the fact you cannot charge less for the same service if you sold it outside the platform (as you'd like to do as you didn't need to collect the Apple tax).
Honestly Apple does not act as an agent for companies that are known outside of the Appstore.
Netflix has an app, Netflix “is not” an app. Google Chrome, Airbnb, Epic, anyone who has spent marketing bucks promoting their service and providing a supporting app, was rather acting as a marketing agent for Apple than the opposite.
Apple’s new stance has no merit. We all understand it’s fair to participate in the funding of the Appstore, but it is a very bad defense.
> And the fact you cannot charge less for the same service if you sold it outside the platform (as you'd like to do as you didn't need to collect the Apple tax).
I thought that was expressly permitted - just that Apple Tax still must be collected:
> The link can mention the specific price of content on a website, or that content is discounted on the website from the App Store price. Comparisons are allowed.
Only in the manner that it is silly: Since Apple demands a 27% tax on a linked purchase, there is no room for an actual discount anymore. You can't charge less for the same service because you're required to pay Apple either way.
In that manner, this ensures you cannot compete with Apple IAP on price, and is hence still wholly anticompetitive.
The fact that your example has a lower apple tax than actual ($3.9 apple tax for $13.0 subscription, not $3.0 as you've stated in the example where a developer would itemize the price or tariff) and none of the people who replied to you noticed is very relevant, too, in the same context as your comment.
Is it still enforced/rule that you can't charge a lower price for a subscription outside the app store? Perhaps thats why streaming services like netflix and max still charge the same price but spend that "Apple tax" to pay other kinds of distributers/promoters like american express, mobile carriers, etc. to offer promotions, bundles or discounts. I think this is how the largest players in the app/subscription market are trying to penetrate the apple tax fortress.
Other streaming services fall into the same category.
If I recall, and from what I’m now able to find, Netflix didn’t lower their prices when they did that move. And remember they have added ads, are cracking down on password sharing, and prices keep increasing.
So while Apple’s cut is high, let’s not fall into the trap of believing that other big companies are somehow fairer and would totally pass the savings onto us. The overwhelming majority, if suddenly exempt from paying Apple’s cut, would keep charging the same thing and pocket the extra revenue.
The legal basis is that Apple is not privy to the transaction that happens outside. Purely on a data privacy basis, Apple cannot force a vendor to tell Apple what it does outside of Apple property. So any link tax that Apple wants to impose would have to be a fixed cost, and not a percentage of what happens in a different universe.
But overpriced goods and services are fairly common and accepted in the marketplace. Gucci handbags, houses, TurboTax, any product or service at a car dealership…
The 30% App Store tax does suck but I’ve never understood why it’s singled out. My best guess is that people hate platforms because it’s a 3-way transaction, which makes everything harder, including price negotiation. And also the service isn’t particularly unique, unlike the house, or a status symbol, unlike the Gucci handbag.
Ironically, if Apple made App Store publication more expensive but invite-only, like a high end Bugatti sports car, I don’t think it would’ve ended up in court.
30% is a lot, but it's particularly egregious when your one and only option is to pay 30% to Apple, who is doing everything in their power to make sure it remains your only option. Apple is a monopoly in this specific scenario, and setting the fee so high comes off as a "fuck you, try and stop me" kind of move.
"Google's lawyer highlighted Epic's willingness to pay the same 30% commissions to Sony, Microsoft, and Nintendo for transactions on gaming consoles previously in the trial."
They're kind of in a weird position because each of those companies are sticking them up, but because mobile isn't the bulk of their revenue, they can afford the legal costs of proceeding against Apple even if Apple retaliates against them in the meantime. Whereas if they got kicked off all the consoles they'd be out of business before the court case is over.
The argument that the consoles are subsidizing the hardware is just an excuse which has the causation reversed. They're not charging 30% because they have to subsidize the hardware, they're subsidizing the hardware in furtherance of their scheme to charge 30%. Without it they would stop subsidizing the hardware, but so what? People would pay less for games and more for hardware.
You might even pay less for hardware, because there would be no more reason to restrict games to a particular console and then you would only need one to play all the games, and Sony/Nintendo/MS would compete like (or be replaced by) Dell/HP/Lenovo.
Price gauging has a very particular meaning; it isn't simply a subjective "you're charging too much".
It is the practice of significantly increasing the prices of goods, services, or commodities during a time of crisis or high demand. This can happen when there is a sudden shortage of a product, like during a natural disaster, or when there is a surge in demand, like for popular concert tickets.
Characteristics of price gauging include:
- unconscionable prices
- taking advantage of a crisis
- limited supply or high demand
In the United States price gouging is illegal after a state of emergency has been declared.
Your tone is unexpectedly adversarial, and yet you're not disagreeing. I was simply answering gp's question about legal foundation of whether one can be considered to be "charging too much" under the law.
>Yvonne-Gonzalez was skeptical of the 30% fee during the trial, and in the ruling she was suspicious about Apple's justification of the commission, writing that "the 30% is not tied to anything in particular and can be changed," but did not order Apple to do so.
She basically signaled that she wished she could do something about it but that Epic didn't challenge the 30%, they challenged the existence of a commission at all. Epic overreached and she can't just make up a judgement about things that haven't actually been brought before her.
Apple's justification seems counterintuitive, given that the commission only applies to app sales or in-app purchases. Since free apps don't pay anything, what is the commission for if not for "services as a payment provider"?
It's very normal for companies to charge some customers more than others based on their ability and/or willingness to pay. See: student, senior, and military discounts, SaaS with organization pricing vs individual pricing, etc.
> Apple is charging a commission on digital purchases initiated within seven days from link out, as described below. This will not capture all transactions that Apple has facilitated through the App Store, but is a reasonable means to account for the substantial value Apple provides developers, including in facilitating linked transactions.
> Apple’s commission will be 27% on proceeds you earn from sales (“transactions“) to the user for digital goods or services on your website after a link out (i.e., they tap “Continue” on the system disclosure sheet), provided that the sale was initiated within seven days and the digital goods or services can be used in an app.
So tl;dr: of that page is that Apple is saying "if you wanna link to your website, it can't be prominent (only a single text link with our language in our chosen placement) and we still get our commission."
Yes. Which the judge explicitly said they'd be entitled to do:
> As discussed in the findings of facts, IAP is the method by which Apple collects its licensing fee from developers for the use of Apple’s intellectual property. Even in the absence of IAP, Apple could still charge a commission on developers. It would simply be more difficult for Apple to collect that commission.
> In such a hypothetical world, developers could potentially avoid the commission while benefitting from Apple's innovation and intellectual property free of charge. The Court presumes that in such circumstances that Apple may rely on imposing and utilizing a contractual right to audit developers annual accounting to ensure compliance with its commissions, among other methods. Of course, any alternatives to IAP (including the foregoing) would seemingly impose both increased monetary and time costs to both Apple and the developers.
They did back when they were part of the developer program. If they can make their case that it is bad faith compliance as part of their original case before the Court goes “c’ya, we’re done here”, they might have something, but Apple revoked Epic’s membership for violating their terms in the developer program worldwide and at the conclusion of this lawsuit, Apple has not been ordered to reinstate it. So Epic can’t really argue that they have or will have suffered a harm under these new terms since they’re still in a position where Apple isn’t doing business with them and their lawsuit under which they did have standing is basically at its conclusion.
I agree. As much as I disagree with the ruling the courts made, they definitely decided Apple was allowed to ban Epic for their store permanently, and so Apple's fees no longer are Epic's problem, legally speaking. Someone else would have to be willing to invest the funding on the legal battle, with pockets as deep as Tim's and the same willingness to go up against a Goliath... one that already won against Epic, and won't be bought out a special deal. Tim Sweeney was uniquely concerned with getting fair treatment for everyone here and that is shockingly rare in billionaire CEOs.
IANAL, but at face value, that seems like it would be, well, quite insane? To emphasize, I've seen plenty of insane stuff in the legal system, but if the argument is basically that Epic doesn't have standing because Apple won't let them be in a position where they could have standing, yet they generally offer that position (dev program membership) to the public at large, that seems like some sort of Catch-22-ish nightmare.
Again, little surprises me in the legal system these days, but I have to think courts would be very skeptical of an argument where a potential defendant controls the gates that decide whether a potential plaintiff has standing.
They can. They have little interest to. Very miniscule reward (the only ones winning in a class action are the lawyers... I am due for a solid $20 from Google though!) for a huge risk.
I'm repeating the words of another commenter, but most app devs aren't competing against Apple but other devs. They aren't billion dollar businesses that stand to benefit by trying to get a lower rev share.
But you've just described the dynamics of every single class action lawsuit. It doesn't matter that the individual devs have little interest, the lawyers have huge interest because winning a sizable class action for a lawyer is equivalent to a having a startup that hits.
The purpose of this class action would be to force Apple to change policies going forward (which would presumably give choices to developers that would allow them to save money and increase their profits). Any cash distributed in the settlement would be a bonus.
But I do agree that most developers probably wouldn't be interested. They don't want to stand up their own payment processor, or don't care to do integrations with a bunch of third parties, and tolerate the fees to use Apple's payments platform. And for many of these developers, their entire business is built on their relationship with Apple. Getting their developer accounts terminated would mean shutting down entirely.
It’s not that difficult to follow. As I recall, and feel free to correct me on the chronology if I get something out of order, it went something like this:
- Epic pushed an update to Fortnite at some point to the App Store that would allow them to issue an update from the server side to enable a flag to offer Epic’s own payment processor where you could buy in-game currency from them instead of IAP. They then issued a server update toggling this flag and began advertising it to Fortnite players immediately.
- Apple removed Fortnite from the App Store for violating their policies.
- Epic files suit almost immediately and begins a PR and advertising blitz they had clearly prepped far in advance. In other words, picked a fight. Epic has standing for this suit because they have suffered a harm (Apple removed their app).
- After a grace period in which Apple explicitly laid out to Epic that they were risking their developer account, offered them time to get back into compliance and resubmit Fortnite to the App Store, they terminated Epic’s developer program account. This ended Apple’s business relationship with Epic.
- That lawsuit has now concluded. Apple took it on the cheek for the anti-steering provisions and has come up with a plan to comply which they are now implementing, all appeals have been exhausted, and Apple and Epic no longer have a business relationship.
(I’m missing some details, and the language is vague because I honestly can’t remember the full timeline of events and would rather be vague than wrong here, but that should the gist of it.)
Put another way, when you choose to be in a business relationship with Apple, Apple is also agreeing to be in a business relationship with you. Apple has not chosen to re-enter a business relationship with Epic, and has rejected Epic’s offers to do business with them. It’s a simple as that. So how can Epic now argue that they have standing for harm caused by Apple’s plan for compliance that affect the way they do business with developers in their developer program when they are no longer in Apple’s developer program?
Once the judge decides they’re done and there’s no more avenues of appeal or additional grounds for appeal, they’ll have no more standing than some random guy off the street who has never signed a single agreement with Apple, not even an iTunes ToS agreement. From what I gather, the Judge wants to be done here too, Epic has had their days in court with the full due process of law but there are other cases to be heard and Epic doesn’t get to hold up the courts any longer because they didn’t get the W they were looking for.
Somebody else, if they think they can do it, can try to have a go at Apple next, but even with the one L they took on anti-steering, I think without some new laws being written their entire business model just got a lot more legally resilient.
Now why is standing important? Put simply, in theory, you can basically file suit against anyone for anything, but if you didn’t actually suffer a harm, and you can’t convince a Judge in the jurisdiction in which you allegedly suffered the harm that you did, then they’re going to throw out your case. It’s a waste of the courts time if there’s no case to be made, you filed suit in the wrong jurisdiction, or you filed suit under the wrong provisions of the law under which you are arguing you suffered a harm.
I think where this could work with Epic is if they can convincingly argue that the reason they no longer have a business relationship with Apple is because of the issues still under dispute in front of the court. No idea if they'd win that argument, but if standing ends up being a question, that's probably where they'd have to go.
Judge Yvonne Gonzalez Rogers already knows Epic no longer has a working business relationship with Apple—the developer account termination happened under her watch after all—and from the court’s perspective, that’s really more Epic’s problem. The trial is over. The appeals are exhausted. Stick a fork in this lawsuit, it’s done. The best Epic can do going out the door is try to spite Apple and piss in their cheerios a little more.
> Apple has not chosen to re-enter a business relationship with Epic, and has rejected Epic’s offers to do business with them. It’s a simple as that.
Apple's public comments to the point have been that Epic is free to resume publishing under the developer program if they abide by the developer agreement, and Epic's CEO has stated they have no intention to do so.
Agreeing to the program terms would seem to put them in a position where they can either argue they have standing or that they have been caused harm, but not both.
Really? How recent is this? I was pretty much under the impression that Apple was done with Epic, but I would be happy to be wrong here. If they can’t come to terms, they can’t come to terms, but it would be nice if they could.
> Agreeing to the program terms would seem to put them in a position where they can either argue they have standing or that they have been caused harm, but not both.
Google got slapped in their case with Epic because they offered inconsistent terms, and promoted the idea of alternative app stores while taking business measures on the back-end to prevent them.
Apple gives much more consistent terms.
The speculation is that the 15%-after-first-year subscription change was something they had actually negotiated with Netflix in an attempt to keep in-app subscriptions, which they then rolled out to everyone rather than keep as a Netflix-only deal.
I'm sure Apple is not sad Epic is off their platform, because they are a bad partner. But they would still let them back under the same terms as everyone else, if they agreed to actually abide them this time.
Okay, but in your prior comment you made it sound like Apple had made public comments that they would allow Epic back on the App Store if they agreed to abide by their terms.
The issue is the last time I recall them saying that was before they terminated Epic’s developer accounts. That was a couple of years ago at this point.
So my question was not about any of that, none of it is new to me, my question was the following: how recently, to your knowledge, did Apple say they would let Epic back in the program? I tried searching around but I didn’t turn up anything recent, or anything from after 2021, but I don’t think Apple’s statements from before they terminated the relationship are applicable at this time, so I was hoping you could provide some additional information that I am lacking.
You missed where Epic was ordered to pay the 30% cut they "saved" when using their own payment processor. It was ruled this cut is completely legal. Now that Epic lost appeal with Supreme Court that ruling sticks.
Apple is likely asking for 27% cut for non-IAP w/Apple because they are saving 3% by not processing credit cards directly. They don't need devs complaining it's MORE expensive to use their own payment processor.
> So how can Epic now argue that they have standing for harm caused by Apple’s plan for compliance that affect the way they do business with developers in their developer program when they are no longer in Apple’s developer program?
Maybe they want to be the competing payment processor for third party developers who are in Apple's developer program, but don't have the resources to litigate against Apple themselves.
Eh well, that’s an angle for standing I suppose, but it’s a bit hard to argue a harm against a service they don’t actually offer. It’s especially hard to argue it before a Judge that already ruled that even under California’s anti-steering law, Apple has a right to collect their commission (that 12 or 27% after the 3 percentage point discount payment processing discount). Apple’s argument would then also be easy: Epic can offer payment processing if they want, that’s between developers and Epic, but Apple is still going to collect their commission no matter what deal Epic does with iPhone developers.
Maybe the argument would be that Apple is actually charging more than 3% for payment processing and is continuing to charge the difference even when you use a third party payment processor, to discourage anyone from doing so. Which could provide a new chance to raise the issue of their high fees, if this is the first time Apple has tried to declare a split.
And doesn't Epic Games Store already do payment processing for third party game developers? We know they want to offer the whole store on iOS but if that isn't yet possible then you do what you can.
> And doesn't Epic Games Store already do payment processing for third party game developers?
Yes, but they don’t currently offer it for iPhone apps and games. Just to reiterate, I think this is the best argument for standing I’ve seen, but it’s not an easy sell and if Epic does get into this business, it leaves them in a position of basically trying to undercut the 3 percentage points that Apple is valuing their payment processor at.
> Maybe the argument would be that Apple is actually charging more than 3% for payment processing and is continuing to charge the difference even when you use a third party payment processor, to discourage anyone from doing so. Which could provide a new chance to raise the issue of their high fees, if this is the first time Apple has tried to declare a split.
Judges don’t usually want to get into the business of setting prices for private businesses. Judge Yvonne Gonzalez Rogers has already determined that Apple has a right to collect their commission, and Apple has already had to define the value of what the payment processing portion of what that is in the Netherlands. ~3% is also generally what you can expect to pay a payment processor to begin with which is why it never, even from the beginning of the App Store, for people to interpret “30%” as Apple’s payment processing fee because even back then, that’s not what any reasonable payment processor charged. If needed, Apple could probably produce documentation showing what they pay a processor.
> Yes, but they don’t currently offer it for iPhone apps and games.
Isn't the whole premise that they want to be in that market and Apple precludes it?
> ~3% is also generally what you can expect to pay a payment processor to begin with
But that's kind of the point. If Apple is charging more than that for payment processing but then only refunding the ordinary amount when you don't use their service, it precludes anyone else from competing with them on price because the customer is still paying Apple the remainder of Apple's payment processing fee which isn't refunded.
The way to evaluate this isn't to look at what payment processors charge, it's to look at what the rest of what Apple ostensibly charges for would cost in a competitive market.
At which point the first thing you'd have to ask is, why is this still a percent of revenue? It is for payment processors because their fee has to account for fraud risk, which scales with the amount of the payment being processed.
Fees as a percent of revenue are quite unusual for providing any kind of hosting services or marketing or development tools etc. Even sales commissions are a percent of the sales attributable to the salesperson, not a percent of all sales including the ones via other sales channels.
Charging a percent of revenue is a strong indication of a monopoly rent because it's so hard for anyone but a monopolist to get away with it. Even when Visa does it, the fraud risk is more of a fig leaf and the truth is a big chunk of that amount is going to fund credit card rewards programs intended to get people to prefer credit cards to other payment alternatives and the credit card networks only get away with charging it because of the weak competition.
And in any event the balance of what Apple provides is typically extremely inexpensive. Development tools are widely available for free, search engines don't charge to be included in search results (and the fee can't be for search advertising when it's paid by everyone), the per-download hosting cost for an average-sized app on Amazon S3 rounds to zero cents. What are they doing that could explain 27% if it isn't a monopoly rent? Why is it 12% for smaller entities, when economies of scale go the other way?
> Judges don’t usually want to get into the business of setting prices for private businesses.
Which is why the better solution is to prevent this kind of tying of products and services together, so the prices can be set individually by the market instead of trying to disambiguate the price of each service when they're all tied together.
They're not in a position where they could have standing, though, since they were in that position and violated the terms of their agreement. The judge has not ordered Apple to reinstate Epic's account and the termination was found to be legal.
A "bad faith" claim essentially admits Apple is in fact in compliance.
It's the weakest objection you can have, and typically would only be sufficient to get relief in very, very specific circumstances where the unfairness could be proven (as intended). But this case involves broad policies for millions of developers, and it's perfectly compliant with permitting other payment processors.
So: there's almost no chance it would be "shot down" on those grounds.
How are they possibly in compliance? The judgement was about Apple's "steering practices", not just allowing 3rd party payment processing.
They're clearly making Apple's in-app purchases the preferential choice by prohibiting developers from using anything but a single plain text link, and scaring users with strongly worded warnings.
IIUC, the ruling said Apple has to allow devs to link to an alternative payment processor (i.e. Netflix can now link to netflix.com instead of the absurd rigmarole they had to endure before). Apple now allows devs to do this, with certain requirements (namely, a 27% commission). Since the court said Apple is allowed to collect a commission, those requirements don't seem to be (to this non-lawyer) illegal.
Are the strongly worded warnings untrue?
Absolutely no one should be surprised by the new policy. Every podcast I listened that discussed the matter when the judge handed down the initial verdict predicted this outcome.
What exactly is bad faith about this compliance? The original ruling specifically called out that Apple would still be entitled to a commission even if people used alternative payment processors.
The main thing that feels icky to me is the hurdles to getting approved to link to alternative payment methods, but even if those are walked back that doesn't solve the main issue, which is that alternative payment providers were never a sensible solution to Apple's tax.
Apple has always argued that the commission is for the App Store, not for payment processing, and it is only collected through their payment processor as a matter of convenience. The policy announced here is essentially the same that they announced two years ago in the Netherlands in response to a similar ruling [0]. I'm surprised that anyone here is surprised that they're doing the same thing in the US.
Yeah, as much as I defend Apple against the “they have a monopoly on the iPhone” crowd, this seems worse than the original restrictions. People have been buying stuff online for decades. There’s no new security issue at play here. Taking a commission from a company that’s already paying for payment processing can’t possibly be seen as reasonable.
How are they even going to attempt to enforce compliance. Is every store required to integrate with their payments API?
If they’re taking payments from the platform and it does turn out to be a scam, now their hands are dirty as well.
> ... this seems worse than the original restrictions.
This is worse from the original restrictions _specifically_ because the original restrictions were chosen to simplify from this sort of scenario.
If Apple says all app purchases and purchases of digital goods/services within the app are subject to the 15/30%, and those payments are always made through Apple, then Apple can check for non-compliance with the contract terms up-front (via App Store review) and then there are no separate books to audit, there is no commingling of revenue from in-app purchases vs independent web purchases or purchases made on other platforms, and so on. No need to audit the company's books, because they are using Apple's books.
It is hard to take Apple to task for charging too much, because the 30% ceiling and who pays it has effectively been the same since day 1 of the App Store. They have only created special cases to reduce that percentage (small business program, multi-year subscriptions).
Regulators can say that you can't block other companies from the "iPhone in-app payment for digital goods" market without being anti-competitive, but it is much more onerous to force a company to continue to provide a set of services (maintaining developer tools and SDKs, reviewing and signing binaries, providing backward compatibility in new OS versions) but for a fee schedule determined by regulators.
> Taking a commission from a company that’s already paying for payment processing can’t possibly be seen as reasonable.
Why not?
There's a decades-running assumption by some that Apple was a ridiculously expensive payment processor, only existing because they gave you no other choice than to use them for certain things (and outright forbade you from using them for others).
But Apple provides other services and access to developers per a financial agreement, and was doing payment processing to meter the revenue split.
The regulator argument is that Apple is blocking other companies from taking in-app revenue for digital services. Apple has now split that out in a few markets for companies willing to take on such complexity.
IMHO the only apps I think actually have benefited from the split are dating apps in the Netherlands - because quite frankly the way many dating services charge people is user hostile and/or discriminatory.
> Regulators can say that you can't block other companies from the "iPhone in-app payment for digital goods" market without being anti-competitive, but it is much more onerous to force a company to continue to provide a set of services (maintaining developer tools and SDKs, reviewing and signing binaries, providing backward compatibility in new OS versions) but for a fee schedule determined by regulators.
A rather obvious thing they could do is just prohibit the fee from being a percent of the developer's revenue. If Apple wants to charge everyone $1000 for a copy of Xcode and the iOS SDK, go to town. But then, people should be able to make competing developer tools and SDKs for iOS, and have competing stores where someone other than Apple is doing the reviews etc.
The main issue isn't even what they're charging, it's that they constrain you from using the alternatives that would induce them to charge less via competitive pressure.
>How are they even going to attempt to enforce compliance.
Per the judge's own words, Apple is allowed access to the company's financials and other information that would allow them to audit developers' use of third-party payment systems.
The relevant quote is below. She's not explicitly granting them that permission, she's saying that it would already be within their rights to make that the rule for participating in the App Store:
> As discussed in the findings of facts, IAP is the method by which Apple collects its licensing fee from developers for the use of Apple’s intellectual property. Even in the absence of IAP, Apple could still charge a commission on developers. It would simply be more difficult for Apple to collect that commission.
> In such a hypothetical world, developers could potentially avoid the commission while benefitting from Apple's innovation and intellectual property free of charge. The Court presumes that in such circumstances that Apple may rely on imposing and utilizing a contractual right to audit developers annual accounting to ensure compliance with its commissions, among other methods. Of course, any alternatives to IAP (including the foregoing) would seemingly impose both increased monetary and time costs to both Apple and the developers.
I'd love to hear your reasoning for why there is a strong chance this will be struck down.
The court didn't rule against the Apple Tax, just on the monopoly for payment provider. I understand that many people misunderstand this point, but that does not change it.
The Apple Tax is very clearly tied to the app store though.
By trying to make it apply to apps purchased on other stores, they are essentially saying they have a right to add a commission fee to any transaction involving Apps that happens on an Apple Device, which seems like an overreach to me.
This whole lawsuit is because Epic wanted to avoid the Apple Tax by processing in-game purchases via their own payment provider, bypassing Apple App Store or Apple Pay or whatever other thing Apple forces everyone to use on iOS.
So Epic is now allowed to use their own payment processer for in-game purchases, but Apple is saying that they will still have to pay the Apple Tax for those purchases.
In this case the "store" is not an app store but an in-game store, sure.
> This whole lawsuit is because Epic wanted to avoid the Apple Tax
That may be, but that's not what the court ruled. The court ruled in favor of Epic on only one count of ten - specifically that Apple must allow other payment processors.
As long as the app was originally installed via the Apple App Store, it's still subject to the Apple Tax.
These conditions are onerous enough that the Kindle app probably still cannot handle in-app purchases.
It's really pretty annoying that I have to leave the Kindle iOS app and go to the Kindle web app to make a purchase. Obviously it wouldn't cost either Apple or Amazon anything to allow this, it wouldn't be insecure or unsafe in any way, and it would be nice for consumers. So the fact that Apple and Amazon haven't made a deal to allow this indicates to me that Apple is putting its competitive interests ahead of its users interests.
Hopefully they all figure something out eventually to allow Kindle purchases from the app.
Do you mean an in-app browser in the Kindle app, or just amazon.com in Safari?
I don't see how Apple would prohibit me from visiting a website, and they've allowed use of content/subscriptions purchased elsewhere in iOS apps for a while now.
What has not been allowed (at least until today) is to directly link to that external website.
No, in a regular browser you can make purchases on Amazon like normal.
If you attempt to purchase a kindle book from within the kindle app, you will not be able to. Nor will there be any messaging explaining how to make a purchase (because apple does not allow such messaging). You’ll just be mysteriously confused about why you can’t buy a book.
They changed this recently, and do allow direct in-app purchases now. In some random podcast interview with an exec at Amazon, I remember them saying that each team gets to make their own independent decision on this, and Audible as a unit decided to allow in-app purchases and pay Apple their cut.
In the Wool example, the Audible book is $31.64, but the Kindle book with the audible add-on is $9.48 ($1.99 + $7.49). Even if the Kindle book was selling for "list price", it would still be cheaper at $27.48.
So, I'm guessing there's just a lot less margin headroom to eat a 30% cut on Kindle prices, but plenty to eat that on Audible's prices.
Arcade is for games only. Also, any discontinued games on Arcade immediately stop working on any device where you have downloaded them. Apps from the regular App Store stay functional, even when discontinued. If you thought you couldn't have less ownership than with the stuff from the App Store, Arcade shows you how. You're merely a tenant, and even if you keep paying the rent, stuff just disappears.
The fact that arcade still exists tells me that people actually pay for it, which is very unfortunate to see so many gullible people out there who are willing to be taken advantage of so much.
I'm a happy Apple Arcade user and it's been great for games that I used to love. Temple Run is an example. I bought it, loved it, but each update had more and more advertisements showing up in the game. A game I paid for.
Now I have it in Arcade, and it's advertisement free.
I feel more taken advantage of by the original maker than I do Apple.
Hey me too. I love Apple Arcade and when my kids want a game, my first question is, “did you look on arcade?”
However, my belief is the entire App Store should be subject to the same rules as Apple Arcade. It would be a far healthier app ecosystem, far less predatory
Am I getting this right? Say I use Stripe as my payment processor. Stripe takes 2.9% + $0.30, then Apple takes 27% so I'm at 29.9% + $0.30 being taken out of however much I charge for my app? For a $10 app, $0.30 is 3% putting the fee at 32.9%.
For the privilege of paying 2.9% more, my users get to see a scary privacy message and when I bill the customer a year later for a subscription, there's a 20-30% chance that their credit card will have expired.
If this isn't a monopoly abusing its dominate market position, then what is?
Oh absolutely it is. But all app store developers are complicit in enabling that monopoly. What should happen is that all app store developers withdraw their apps until Apple sees the light. But that won't happen because every app store developer will be pitted against their competition in a race to the bottom who will accept the highest fees that Apple is going to impose and sooner or later you'll be back at that 30% or you'll go without income. Solidarity is what drives change, without solidarity you're without a chance.
I think this does a disservice to actual victims of actual crimes. This is at most a business dispute over fees. The app store developers were cautioned that throwing their lot in with Apple (and let's not forget Google) would eventually lead to a situation where Apple controlled their business and could charge whatever they wanted. But the money was good and so the walled garden App stores became entrenched. But in principle they were always broken.
This is why unions are a thing. They create collective bargaining power. If all of the app store vendors would unite they'd have a formidable position vis-a-vis Apple, Google etc. And there is no reason why app store developers could not form such a collective to increase their bargaining power.
You must have seen it mentioned on HN before: don't build your house in someone else's garden or something to that effect, in other words: if you make all of your income in someone else's eco system you are giving them a lot of power over your business. That's a bad move, but if you have to do it make sure you have a lot of friends, just in case.
To be fair, Apple doesn’t actually charge more than they did on Day 1. In some cases they charge less.
> And there is no reason why app store developers could not form such a collective to increase their bargaining power.
This is also where you lose me entirely. You’re basically talking about unionizing independent businesses. Just call it a cartel. That’s the word you’re looking for.
> Just call it a cartel. That’s the word you’re looking for.
No, a cartel is something different entirely. A cartel is a bunch of businesses that set the price for a market, not a collective that serves to increase the bargaining position of individual entities that are too weak to do so on their own power. Cartels are all about price fixing while keeping the competition out.
That’s a nice spin and I see why you’re determined to use nicer terminology, but in this case it’s a cartel, so own it since it’s your idea here. The aim is to fix a price, and the price you are trying to set is the price at which another business buys units of your software or services for resell. The price is 30% of purchase, 30% of in-app purchases, 30% of in-app subscriptions for the first year of an individual unit’s subscription term and then 15% for subsequent terms[1]. If you use a separate payment processor, you can reduce these figures by 3 percentage points. That’s the price, and their right to charge it has been upheld, but your proposal is to band together the small, medium and large businesses that virtually fill the App Store and have them War Doctor around going “No more!” or dictate a lower price. That’s collusion, that’s price fixing, that’s a cartel.
[1]: through some silly chicanery requiring an application process, and only if your business earns $1M or less a year. Apple may be within their rights but damn do they make themselves look bad when it comes to this shit.
> That’s a nice spin and I see why you’re determined to use nicer terminology, but in this case it’s a cartel, so own it since it’s your idea here.
No, the aim is not to 'fix price'. A cartel sells a resource at an artificially inflated price to a group of consumers who have no idea that this is happening (unless the cartel owners happen to advertise the fact). Typically cartels are illegal.
> The aim is to fix a price, and the price you are trying to set is the price at which another business buys units of your software or services for resell.
No, it is not about setting a price. It is about setting a (reasonable) cap on a margin on your own price. That's an entirely different thing.
> That’s the price, and their right to charge it has been upheld, but your proposal is to band together the small, medium and large businesses that virtually fill the App Store and have them War Doctor around going “No more!” or dictate a lower price. That’s collusion, that’s price fixing, that’s a cartel.
> No, it is not about setting a price. It is about setting a (reasonable) cap on a margin on your own price. That's an entirely different thing.
Okay, so what if Apple decided a reasonable price for doing business with them was between 12% and 30% of the price you set per unit, and that you can take it or go into a different business writing software for other platforms instead, for which a non-exhaustive list in 2024 includes the following: Windows, Android, PlayStation, Xbox, Switch, Linux, servers, the Web, embedded systems, supercomputers, mainframes (no really), webOS televisions, and custom systems? Pretty soon, depending on how this DMA stuff shakes out and how Apple ends up complying, you might even be able to develop for iPhones on less onerous terms, but only in the EU, so add EU iPhones to the list above as a “maybe” after March 7th.
Some people might take that deal, and others might choose to do their work somewhere working on something else. How do you plan to deal with the businesses that are just going to take the deal? Like they have been, every single time they’ve voluntarily signed the developer agreement without a gun to their heads and invested more money into building on Apple’s platforms?
I don't think there are victims per-se, just people that have willingly enabled a mechanism to come into being that they profit from at the expense of general freedom in computing. That Apple and Google would throw their weight around was a foregone conclusion and if MS manages to make it so that installing software on PCs can only happen through their app store (which is a fair chance, all the indicators are pointing towards them shooting for this at some point) they definitely will not shrink away from that.
Also note that through their control of GitHub they could shut down 90%+ of of the FOSS movement out there with the click of a mouse.
I still disagree with the form of your rhetoric as I do see cartel as a more accurate description, but out of respect for the internal consistency of your argument, I’ll drop it. People can see the case you made and make up their own minds. :)
That's true, any sizeable fraction will probably work. There could even be multiple such collectives which may or may not collaborate on particular efforts.
> I think this does a disservice to actual victims of actual crimes.
Your original comment used the term “abuser”, which refers to a very specific kind of crime that not only frequently does involve a victim’s acquiescence to their abuser, but that is often the ultimate purpose for the abuse. I understand what you’re trying to say, but I think it’s probably for the best to simply avoid using domestic violence to make such analogies altogether.
It not only risks being taken to be in poor taste, but I think it’s also unnecessary in this context. It’s not especially difficult to understand why Apple’s market position gives it the kind of outsized leverage to force other stakeholders into engaging with unfair, even illegal, practices that are frequently contrary to their own interests. In negotiations, and within free markets more broadly, there’s a level to which this kind of uneven power dynamic can be productive, but it’s very clearly gone too far here, and is rightly seen as suppressing competition, stifling innovation, and sabotaging the potential for entrepreneurs and small businesses to thrive.
It’s precisely the kind of thing that the federal government should be on top of, but until congress resumes its regularly mandated duties (it’s my understanding that the United States Congress has been starring in some sort of reality TV program for the last several years, and must continue until they have voted all but the last remaining legislator off of Joe Manchin’s houseboat) it’s probably a good idea to explore other options, like labor unions or maybe crowdfunded federal class action lawsuits.
> Your original comment used the term “abuser”, which refers to a very specific kind of crime that not only frequently does involve a victim’s acquiescence to their abuser, but that is often the ultimate purpose for the abuse. I understand what you’re trying to say, but I think it’s probably for the best to simply avoid using domestic violence to make such analogies altogether.
Abuser has much wider connotations than just domestic violence and I'm not so focused on sex crimes/domestic crimes that I see the term as inexorably connected but for those that do feel free to substitute another term that indicates a power relationship between two parties in which one takes advantage of the other even if the other willingly entered into the relationship.
Note that class action suits are not powerful enough for this: they simply allow Apple to partition the world into many small fiefdoms each of which will have to fight individually for their rights. Much better to tackle this as all developers versus Apple, that way you stand a chance of making it stick.
If you can legitimately blame the middle of a pyramid scheme for tolerating the top, you can blame app developers for tolerating apple. Both do so at the expense of those at the bottom.
What should happen is that governments regulate these policies out of existence (or into sensibility). We already do this for things like credit card processing fees (in Europe) and it works well.
Yes, that would be good. This goes for all predatory businessmodels, especially the ones where bait-and-switch is used to gain market share and then to change the model (looking at you, Youtube).
App store developers are suppliers, they don't work for Apple nor do they have to work for Apple. Technically Apple re-sells their product. But they could and should unite in order to increase their bargaining power. You see the same with every supermarket chain.
But what I think would happen is that there would be enough hold-outs from such an effort that Apple would come out on top because the players in the eco -system are more in competition with each other than that they really mind Apple. They want to pay Apple less but they want to put their competition out of business even more...
In the age of the internet I think reaching tens of millions of individuals is not as hard as it used to be. A Reddit post announcing a boycott of the App store by a few hundred or a few thousand initial App developers with enough lead time for the message to spread would be a fine starting point. I'm sure it would be all over the globe by morning.
I just posited the idea here in NL at 2:30 in the morning and you, somewhere else entirely have already heard of it. That mechanism could be vastly improved upon but I think the principle is sound as your average cat meme has proven thousands of times by now.
My solution is much simpler: I've opted out of all App eco systems entirely because I think Google and Apple already have enough power as it is. My software is free, free to download and free to run.
I'm not convinced that this would result in lower prices for me as a customer. The current prices that work for a company to stay in business and make a nice profit (think anyone from Netflix, to whoever makes Clash of Clans) show that there is a willingness to pay those prices.
If a developer union of sorts succeeds in negotiating down Apple's charge, there is absolutely 0 chance that this cost savings will make its way on the whole to consumers precisely because developers have already proven that customers are willing to take a higher price.
As an end customer I think it's a good thing if an indie developers get more money in the abstract. I don't think I care if it means that Netflix gets to keep more of their money instead of Apple.
I'm much more sympathetic toward lower fees for smaller companies. Once you are the size of Meta, Google, Apple, Amazon, Netflix, Spotify, etc. it's just jostling between multi-billion (trillion) companies and I'm not really concerned one way or the other, especially if these actions result in more annoying behavior that I have to deal with, like multiple app stores, increase in spam and ads and spying, and the dissolution of the power of features like Sign in with Apple that allow me to generate fake email addresses.
Ah yes, this again. "We can only have nice things because of the golden handcuffs Apple has blessed us with!". Except that there's plenty of counter examples. And you might not care, but thousands of independent app developers getting bent over the barrel by Apple certainly care. In my view, it's not even really about the end consumer price.
> I'm not convinced that this would result in lower prices for me as a customer.
That's perfectly ok because that's not the intended effect, the intended effect is to stop Apple/Google from exacting a 30% toll on their platforms, not to improve consumer prices.
> I'm much more sympathetic toward lower fees for smaller companies.
I don’t think you’d be required to use alternative app stores. You could keep using the Apple one if you wanted. Market forces should allow the best store to win.
Having another “store” doesn’t necessarily mean having to get apps elsewhere. E.g., the one platform app store has severely degraded my ability to enjoy audiobooks. I used to be able to buy books directly in Audible (on Android anyway). It was convenient and Audible offered daily deals. I’d get books on a whim and discover new authors that way. Once Audible had to start paying a 30% tax, that feature went away. Now I have to browse & purchase in a web browser, which is far less convenient.
Incidentally, both Apple and Google sell audiobooks. Presumably they aren’t paying a 30% tax themselves and can use that as a builtin price advantage. But, then I’m tied to that platform.
In this case, you'd be making an "in-app purchase" with your Amazon account. There's no new annoyance in payment management and there's no new store to browse. You just get a more convenient way to buy content.
> I don’t think you’re required to use alternative App Store.
You’re also not required to use an iPhone. Grab an Android phone with the features you want (multiple app stores) and you’re good to go!
Anyway.
The best store isn’t necessarily the best store for me, and apps (think TikTok, etc.) have more pull than an App Store does so what will happen is they will launch their product only on non-Apple app stores that have less strict requirements and review processes and people will go download from there. Customers will have to download multiple app stores, manage subscriptions in multiple places, have to manage user profiles and credit card information across multiple app stores, etc. It’s kind of like today with the competing streaming services. Not great.
While this presents a few problems, my chief concern is that it unwinds some of the great features that Apple essentially lobbied for on behalf of customers. Features such as Sign in with Apple, and other privacy oriented features.
With multiple app stores customers have no bargaining power or anyone bargaining on their behalf. It’s a marriage of corporate interests united against customers.
I’m struggling to see the benefit to customers. It seems like we’re trying to screw normal people so a few big companies like Meta can make an extra buck and grab up more of your data.
> You’re also not required to use an iPhone. Grab an Android phone with the features you want (multiple app stores) and you’re good to go!
The situation isn't much better on Android. Yes, there are multiple stores, but since Google Play Services are locked up you effectively have to use the Play Store. Of course, there's more to consider than just the store and there are other reasons, some involving lock-in, to want to use an iPhone.
> While this presents a few problems, my chief concern is that it unwinds some of the great features that Apple essentially lobbied for on behalf of customers. Features such as Sign in with Apple, and other privacy oriented features.
Using Android as an example, that just didn't happen. Granted, part of that is the hoops Google has you jump through to sideload anything. Samsung and Amazon both have stores and outside of Amazon Fire devices, their adoption is quite minimal. So, I don't think this future where everyone abandons the Apple App Store is apt to happen. Having competition in the space should spur Apple to deliver more. And as a consumer I have the option to sideload apps on my computing device if I'd like.
> With multiple app stores customers have no bargaining power or anyone bargaining on their behalf. It’s a marriage of corporate interests united against customers.
I don't know what power I really have with Apple's App Store. Some parts are nice. Some aren't. I have no ability to influence that. I can't "let the market speak" without using a completely different device.
Moreover, other app stores need to have an actual proposition to get adopted. Assuming companies still want to make money, they'll likely still sell apps through the Apple App Store.
> I’m struggling to see the benefit to customers. It seems like we’re trying to screw normal people so a few big companies like Meta can make an extra buck and grab up more of your data.
I don't care at all about helping Meta make more money. I think you'll find that's true for almost everyone. I'm not looking to screw myself or anyone else for that matter. I do care about the grabbing more of your data part. But, that's an argument against mobile apps. In Apple's locked down ecosystem I have no control over the data collected. In a web app I can run a blocker, at least.
I care that mobile devices are the general computation devices of this generation and we ceded control of it to Apple and Google then let them add a 30% tax onto it and control what we can run on our computers. If Microsoft did this with Windows applications, we would rightfully call out their anti-competitive behavior.
The common retort at this point is "just don't use a mobile device." That was a valid answer for a while, but particularly with covid, a lot of things became mobile apps with no web alternatives. I had doctor's appointments that required using an application on one of those two platforms.
As a consumer, I also dislike that Apple and Google don't really need to respond to market demands. Changing platforms is a huge upheaval and can be quite costly, since there's really no cross-platform licenses available. You just need to re-purchase all of your apps and any media. They also lock you in with their cloud services. Sure, I could use Dropbox, but Photo shared libraries only work with iCloud. They have a captive audience and get away with a lot that they wouldn't with a competitive marketplace.
I get it. Plenty of people like the gilded Apple path. But, we're well beyond the point of platform being limited to peripherals for Apple enthusiasts. These are primary computing devices that are essentially unavoidable. Switching to Google is an impractical solution and doesn't address the core problem anyway, so that's a non-starter. If the cost of opening up the platform is you can't get Fortnite in the Apple App Store, I can live with that. In the unlikely event Apple...
It is. I'm not an App store developer for a reason. There is no way that you can get me to carry water for Apple or Google by putting them in between the users of my work and me. Ditto Microsoft.
And I'm perfectly ok with App store developers doing what they are doing and making lots of money. But there is a price tag and they either must be ok with that or like me they'd opt-out.
So I've been 'striking' for as long as I've had App ideas and things that I could have fielded as an App but ended up just putting on the web. I don't need to convince anybody.
Do you think that the King.com and the other large companies that make all of their money by selling coins for pay to win games are going to join the boycott?
It came out in the Epic trial that’s where 90% of the revenue comes from. It’s not from small indy developers
They were. You teach people how to treat you. If you congratulate people for working to improve their conditions you have to say they had a hand in the bad conditions before.
Yes, this is exactly what enables Apple to do what they do and proves my suspicion: that there are enough developers that do not see this as a problem that things would likely remain as they are. Let's be happy that dockworkers had more spine than that.
There was side-loading on Symbian and Windows Mobile phones before iPhone and the App Store existed.
You know what the experience was in one word?
Shit.
For both developers and consumers.
Then comes Apple with amazing hardware, software and APIs with focus on developer experience.
Developers decide to ditch side-loading & stuff like xda-developers in favor of 30% fees to develop for iOS (and then Android) because it’s so amazing for them and the consumers.
It got to the stage where developers were so happy with the 30% fee and Apple/Google duopoly, many even didn’t even try to develop anything for other mobile OS’s including the Windows Phone store.
Microsoft tried to fund app developers and spent millions, without much luck.
No modern apps, no consumers, no sales.
Microsoft then had no other option than to admit defeat, write off billions and shut down the era of Windows on mobile phone devices.
Even Epic never released Unreal Engine on Windows Phone, and cries the loudest today about the duopoly they helped to build.
So now you’re saying after abandoning side-loading, agreeing to 30% fees for an access to a worldwide billion people marketplace, suddenly after 15 years it’s terrible and we should go back to side-loading again, because greedy Apple?
Yes, RMS warned about that. Convenience comes at a price. The question is whether or not it is worth it. Apple seems to have convinced enough developers and enough consumers that it is. I disagree which is why all of my stuff is 100% web based (and it even works off-line), but I don't begrudge others their income. At the same time I do think that Apple is abusing its position, but since it was obvious they were gearing up to do just that from day #1 you can only blame them for about half of it with the remainder divided between the devs and the consumers.
macOS has both an app store and sideloading. It works great!
I personally use the app store for apps I don’t know/trust the developer of, because I trust Apple’s diligent vetting regarding data collection etc., and I sideload everything that I do trust, or that Apple “wants to protect me from” for non-security/privacy reasons.
There are so many problems with this take. Here are a few:
1) Many App Store apps are completely free, paying nothing to Apple except the $99 per year fee, so they have no stake in this issue.
2) My understanding is that more than 90% of developers in the App Store make less than $1 million per year and thus are covered by the Small Business Program, which charges only 15% rather than 30%. Revenue in the App Store is extremely top-heavy, with most going to a relatively small number of the top developers (such as Epic, previously). How much are developers willing to risk just to lower the 15% cut somewhat?
3) Let's be clear, you're talking about a strike. Many developers derive their entire income from the App Store, so withdrawing their apps means no income. A wealthy corporation such as Epic can survive, but what about little indie developers?
4) An individual developer uniterally striking would be futile and self-destructive. Developers would need to be organized and all strike simultaneously.
5) Strikes are very difficult to organize. Forming a union almost always has to come first. And union members typically work together in the same building, which greatly facilitates organization. Whereas there are a huge number of App Store developers scattered all around the world, and they speak different languages. How would you even communicate with all of them to organize? (EDIT: I see in another comment that you think it's easy as spreading cat memes. That's not a serious suggestion.)
> 1) Many App Store apps are completely free, paying nothing to Apple except the $99 per year fee, so they have no stake in this issue.
I don't see that as a problem.
> 2) My understanding is that more than 90% of developers in the App Store make less than $1 million per year and thus are covered by the Small Business Program, which charges only 15% rather than 30%. Revenue in the App Store is extremely top-heavy, with most going to a relatively small number of the top developers (such as Epic, previously). How much are developers willing to risk just to lower the 15% cut somewhat?
I can't answer that question for any particular developer. But if my PSP charged me 15% I'd be looking for another one and if my PSP arranged for things in such a way that I'd owe them anyway by virtue of developing for a particular piece of hardware that they already sold and made their profits on I'd go and do something else with my time. Which is why pianojacq.com is on the web and free instead of an App in the App store because that way Apple/Google don't get to increase their grip on the market regardless of whether or not it is free. I disagree with their business model to the point that I'm not partaking in it at all.
> 3) Let's be clear, you're talking about a strike. Many developers derive their entire income from the App Store, so withdrawing their apps means no income. A wealthy corporation such as Epic can survive, but what about little indie developers?
What about those poor dockworkers? Any kind of battle with the likes of Apple (or your merchant marine overlord) comes at a price. In some cases people died to fight for their rights. 'little indie developers' are still business owners who will either stand up for their rights or they will have to live with the consequences of not doing so. More likely: those that do stand up for their rights will find themselves kicked out of the App store (monopoly power abuse...) and their competition will thrive.
> 4) An individual developer uniterally striking would be futile and self-destructive. Developers would need to be organized and all strike simultaneously.
Yes, you got it. That's exactly what they should do.
> 5) Strikes are very difficult to organize. Forming a union almost always has to come first. And union members typically work together in the same building, which greatly facilitates organization. Whereas there are a huge number of App Store developers scattered all around the world, and they speak different languages. How would you even communicate with all of them to organize?
I would start with looking for places where App developers congregate and start spreading the message (SO / HN / Reddit / whatever remains of /. / any other forum), write a bunch of press releases and build a movement, then, when the numbers are there for the GADA (the Global Appstore Developer Association) I'd announce the first collective action and take it from there.
It will be work, but so what, if you think it is worth it then it's worth doing well.
As for language barriers and such: there's an app for that...
> I can't answer that question for any particular developer.
I can answer for this particular developer. No, it's not worth it for me. There are many huge problems with the App Store, but I personally don't consider the 15% cut to be among the top problems. I could write a long screed about those problems (and I have before), but that would be a bit off topic. I will mention one thing though: I think the "race to the bottom" is a much bigger problem than the cut. I would happily pay a much higher cut if I could charge higher prices for my apps. Just look at the simple math: 85% of $1N = $0.85N < 50% of $2N = $1N. Thus, a 50% cut would be worth it if I could charge twice as much.
Incidentally, I think even for Epic, the 30% cut is not the entirety of the problem. Epic is a cross-platform company, and App Store payments, locked in and controlled by Apple, make it difficult for Epic to do anything cross-platform that includes iOS.
> What about those poor dockworkers?
Well, I'm not poor. I don't need a higher income to survive. Also, going back to the points I already made, it's realistic for dockworkers to organize and all strike simultaneously, because of their much smaller number, geographic congregation, and shared interests.
> In some cases people died to fight for their rights.
You want me to die to slightly improve the App Store? Um, no thanks.
> write a bunch of press releases and build a movement
Oh, is that all?? Write the press releases, and they will come, amirite!
> It will be work, but so what, if you think it is worth it then it's worth doing well.
I've actually tried to organize a boycott of Apple's Feedback Assistant, but it doesn't seem to have been very effective. Organizing is extremely hard, especially a global movement! No, it's nothing like cat memes or Hacker News comments, especially when the stakes are so high.
> As for language barriers and such: there's an app for that...
Give me a break... I wouldn't even trust the apps for doing customer support, much less union organizing.
> There are many huge problems with the App Store, but I personally don't consider the 15% cut to be among the top problems.
You and many others like you. Hence the need for solidarity and that's why I don't think it would work. It's hilarious how in the same thread devs like you are being called 'victims' and here you are expounding on how you are going to continue in the relationship unchanged because it suits you just fine.
> I could write a long screed about those problems (and I have before), but that would be a bit off topic.
Fine.
> I will mention one thing though: I think the "race to the bottom" is a much bigger problem than the cut.
Yes, that's why you need to organize. That stops the race to the bottom. This is exactly why strike breakers are looked down upon and why companies used to bring in 'scabs' to break strikes. To push that race to the bottom that much further.
> I would happily pay a much higher cut if I could charge higher prices for my apps.
Of course you would. Because that means more money in your pocket.
> Just look at the simple math: 85% of $1N = $0.85N < 50% of $2N = $1N. Thus, a 50% cut would be worth it if I could charge twice as much.
I think most people on HN have a fairly good intuition about such things.
>> What about those poor dockworkers?
> Well, I'm not poor. I don't need a higher income to survive. Also, going back to the points I already made, it's realistic for dockworkers to organize and all strike simultaneously, because of their much smaller number, geographic congregation, and shared interests.
And because they're not going to stab each other in the back at the first opportunity.
>> In some cases people died to fight for their rights.
> You want me to die to slightly improve the App Store? Um, no thanks.
No, definitely not. I don't even want you to be inconvenienced. But you've definitely illustrated why Apple is firmly in the seat of power here and given ample evidence for my thesis that the App store developers are doing it to themselves.
>> write a bunch of press releases and build a movement
>Oh, is that all?? Write the press releases, and they will come, amirite!
So, you want it to be easy? I personally don't care enough to do your work for you, and if you don't care either then the work won't get done. But then we can stop sympathizing with App store developers.
> > It will be work, but so what, if you think it is worth it then it's worth doing well.
> I've actually tried to organize a boycott of Apple's Feedback Assistant, but it doesn't seem to have been very effective. Organizing is extremely hard, especially a global movement! No, it's nothing like cat memes or Hacker News comments, especially when the stakes are so high.
The stakes are so high because people who should care don't and that includes yourself. Your boycott failed because many people look at that problem just like you look at the fees issue. Without organization you can not solve these issues at all.
> > As for language barriers and such: there's an app for that...
> Give me a break... I wouldn't even trust the apps for doing customer support, much less union organizing.
Forgive me for my failed attempt to injecting some humor into the discussion.
I'm quite familiar with the guidelines, I don't see how my comment violates any of them, especially not 'badly'. Could you please point out which part you think violates which of the guidelines, I'd be more than happy to edit my comment to accommodate you.
The comment consisted of personal swipes or straw men. It was completely disparaging, not a serious response. Some examples:
> here you are expounding on how you are going to continue in the relationship unchanged because it suits you just fine.
> Of course you would. Because that means more money in your pocket.
> And because they're not going to stab each other in the back at the first opportunity.
> I don't even want you to be inconvenienced.
> So, you want it to be easy? I personally don't care enough to do your work for you, and if you don't care either then the work won't get done.
> people who should care don't and that includes yourself.
That's how you talk if, as an outsider, you don't want the perspective of an App Store developer. If your desire is just to rip on me for doing it to myself, then you don't need me here to do that; you can accomplish such denigration on your own, in the self-congratulatory, know-it-all fashion that you've been exhibiting.
Organizing masses of individual people around a shared goal against a powerful opponent is one of the hardest tasks in the world. For example, the majority of people in the United States hate both of the two major political parties, and lots of people say, "We should have a third party!", and there are indeed many minor party alternatives, but turning one of those minor parties into a viable alternative to the existing major parties is obviously extremely difficult. It's not that people don't want to, but the barriers to organization are massive and multifarious. Though everyone may have the same vague goal, the devil is in the details. And the costs of defection from the status quo can be significant; as small as they are now, third parties are still blamed as "spoilers" of elections.
> Yes, that's why you need to organize. That stops the race to the bottom. This is exactly why strike breakers are looked down upon and why companies used to bring in 'scabs' to break strikes. To push that race to the bottom that much further.
Funnily enough, what he's describing is called "price fixing" and is illegal. The "race to the bottom" is competition keeping prices low for consumers and is a feature, not a bug.
Yes, indeed. But that's precisely why I don't have that much sympathy for any of the players in the App eco systems (consumers, Apple/Google, developers) they are all accepting each others transgressions each for reasons all their own. I never thought that computing would come to this but here we are.
Isn’t race to the bottom caused by competition? What policies could Apple implement to keep the price of apps higher? Why would consumers want that? Surely price pressure will happen in any large market.
I think the difficulty of pirating apps on iOS does help developers. At least I’ve heard that piracy is a big problem on Android.
All the subs I followed are a shadow of their former selves.. there's still some half-assed content posted, but it's not worth bothering to try and keep up any more
I was on a bunch of small niche subs with 10k users or fewer each
Seems like the giant subs like you're talking about are still running, although they're a lot lower quality now that it's effectively impossible to use Reddit on a phone
Reddit moderators are unpaid volunteers. They lose exactly $0 if they "strike". The stakes are extremely low in comparison to pulling apps from the App Store.
And there are only 75,000 Reddit moderators in total. That's vastly smaller than the number of App Store developers.
You're certainly not talking about a strike. A strike is when employees refuse to work. What you're suggesting is that the app developers form a _cartel_, and perform a boycott.
How is this any different from brick&mortar big box retailers beating on their suppliers to lower their wholesale prices to the point they can only make a profit with large volume in sales? I guarantee you that 70% of your MSRP is way more than selling in a store.
and yet this has been happening long before Apple and App Stores were a thing, and nobody has been sued to stop it.
Also, as some other comment has pointed out, the % Apple takes is from their role as one manager. Ask an actor or sports ball player what happens if they don't pay their manager the % owed.
I just haven't figured out why software devs think they are so special that they don't have to pay to play. I have seen no honest answers to this other than Apple === BAD. Devs are pretty much "all monies are belong to us"
One difference: physical goods suppliers can theoretically choose to sell and deliver direct any of their goods to any consumer willing to pay for them. With the app store, at least in the US, the captive audience can’t side-load, and now Apple is introducing even more absurdity with its bad faith “revision” to the policy.
That's true to an extent, and your "theoretically" is doing some heavy lifting. The big box retailers have pretty much limited your options there. So while it's not a single choice of stores, you might get 3 or 4. If you want to sell physical items, you want to be sold in Walmart. That's where the shoppers are. When you come out of the meeting where they tell you what your wholesale price will be, you won't even look like the same person. Depending on your product, you might have some other options, but those sales will be well under anything a big box can offer. You just won't be making much money per item.
Indeed. You can see this clearly in how even at places like 'Makro' ('Metro' in some other countries) prices ex vat can still be higher than in the big chain supermarkets.
Walmart is the thousand pound Gorilla, yes. But countless clothing brands exist outside of Walmart & probably wouldn't want to be in Walmart anyways.
It's some weak sauce weasle wording to say, "you might have some other options". This position seems slanted as heck: working overtime to convince everyone that Walmart puts people through the ringer (true) & is the overwhelming desirable option (false), as if that justifies Apple being an awful squeezer too. As though Patagonia, North Face, Colombia, Gap, Saks 5th Avenue & every other brand only dream getting in the big store, as if they live horrible worthless lives now.
No, there's a ton of ways to sell clothing. Volume is one way to do it, but there's a free market here with lots of possibilities and no one is railroading brands and makers into awful decisions. There are also online only folks who just have their own e-storefronts and/or others. There's so many channels. Apple's App store has a unique in the world today, of dominating a massive sales channel it's customers cannot escape, on one of the most general purpose soft devices on the planet. For basically happening to do their job of building a consumer OS and not a lot more.
(Steam I think is a more interesting case, where they compete freely & without anti-competitive hacks, but still basically are the de-facto middleman.)
If you think a chain that can afford to open its own stores is the same thing as a company making a single thing or even a couple of things, then you're well beyond weasel words and are in a delusional state. Most people make something and need to have it sold at other stores. You've made hell of a leap here to try and call me a weasel
We're talking app makers. The equivalent would be pre-internet days of selling software at computer stores or again big box retailers. Again, your options are limited. If you're an app farm that just shits out clones of other software, you can burn in a fire and I don't care what happens to you.
Organized labor has effected plenty of change, both directly and indirectly. Safer working conditions, 40 hour work weeks, sick time, pay raises, etc.. Companies without unionized employees are incentivized to offer reasonable work conditions and benefits to stave off unionization. This has all happened under capitalism.
Just because developers have fallen victim does not mean they should all pull their apps. How would you suggest that all impacted developers go about coordinating such a strike?
Solidarity is very difficult to achieve in a large enough consensus to a point where people would pull their apps.
Apple need the 30% to keep the services revenue up to keep the stock price up. I have no doubt many people at Apple know this is wrong, including the people at the very top, but stock must not go down.
It's obviously not 30%, because on top of this you better pay for ads on your app name or have your competitor show up on searches for your app.
I always had a mild smile for the tales of the "secure refined Apple store" but seeing the reality has been a bigger shock than I expected. It's a scam haven.
The market obviously exists. Apple is the seller, numerous other businesses are buyers, and they are buying, hence the current amount is an amount "the market" is willing to pay.
I would say there isn't such a thing as "the right amount of profit margin" as much as there is "the right way to secure a profit margin". The more your margin is able to exist because competition isn't allowed the less right it is, be it 1% or 99% in absolute terms.
Can I use the Google Play store on my iPhone? If not, there is no other provider competing with Apple in the market that is “selling apps to iPhone users”.
Whether that’s a market considered relevant from an antitrust point of view is the big question.
I can't use another company's GPS system in my car, so in the market of, "Using GPS navigation / menus / etc in my 10 year old Mini's dashboard" there's no meaningful competitor. They charge for map updates and everything.
At some point a company is just building a feature, and they're not required to make every single feature accomodate every other manufacturer's competing version of the feature. I knew I was buying the Mini system when I bought the car, and I accepted it. Same is true for iPhone users.
> I knew I was buying the Mini system when I bought the car, and I accepted it.
"Knowing that you're buying into a monopoly" is generally not a valid defense for a monopolist. The idea is that there can be a disadvantage/harmful impact to market participants even despite their full knowledge of the market structure (which isn't even a given for retail consumers).
But generally, I agree: There are definitely many closed ecosystems/non-competitive "markets" like the ones you describe, and more often than not, regulators don't step in. Who knows, maybe regulators will address that market at some point! The EU DMA doesn't seem to obviously not apply in this scenario, for example.
Several factors for why I'd consider that case to be a bit different though:
- Many car entertainment systems now offer you to connect an iPhone or Android phone and use CarPlay or Android Auto for navigation. You can reasonably use the car's navigation functionality (GPS antenna, voice output, built-in screen that won't hit your head in an accident) without paying the car manufacturer!
- If your car doesn't allow that, or you don't want to use Apple's or Google's solutions, you can stick a physical aftermarket navigation system to your windshield/ventilation grill.
- There isn't a single car maker that controls roughly half of the US market.
That's exactly what I'm arguing for. Two competing (commercial) smartphone OSes are probably just fine! Much more than that would probably make it uneconomical for developers to provide native apps for all of them, unless they're API compatible.
> Given the trial record, the Court cannot ultimately conclude that Apple is a monopolist under either federal or state antitrust laws. While the Court finds that Apple enjoys considerable market share of over 55% and extraordinarily high profit margins, these factors alone do not show antitrust conduct. Success is not illegal. The final trial record did not include evidence of other critical factors, such as barriers to entry and conduct decreasing output or decreasing innovation in the relevant market. The Court does not find that it is impossible; only that Epic Games failed in its burden to demonstrate Apple is an illegal monopolist.
You've already skipped over the most important aspect of determining if someone is a monopoly, which is defining the relevant market. A key piece of the Epic v. Apple case was determining the relevant market, where "phones" was never even considered as a possibility.
This was always what the outcome was going to look like. People have been talking ever since the ruling as though dodging Apple as a payment processor was going to magically exempt developers from the full 30% fee, but that was never going to happen and it was never the intention of the ruling.
Apple argued from the very beginning that the 30% was its fee for running the App Store, marketing the apps, and storing and delivering the app bundles. The in-app payment system was a convenient way for Apple to collect its commission and a way for Apple to create a unified payment experience for its customers, but it was never the Achilles heel for Apple's business model.
The best case scenario here is that Apple is forced to walk back some of the more onerous requirements they've imposed for whether and how links may be shown. Them putting a price on the payment processor portion of the fee and discounting developers for that portion was inevitable and isn't even malicious compliance, the judge explicitly called this out as a likely outcome in the original ruling:
> First, and most significant, as discussed in the findings of facts, IAP is the method by which Apple collects its licensing fee from developers for the use of Apple’s intellectual property. Even in the absence of IAP, Apple could still charge a commission on developers. It would simply be more difficult for Apple to collect that commission.
> In such a hypothetical world, developers could potentially avoid the commission while benefitting from Apple's innovation and intellectual property free of charge. The Court presumes that in such circumstances that Apple may rely on imposing and utilizing a contractual right to audit developers annual accounting to ensure compliance with its commissions, among other methods. Of course, any alternatives to IAP (including the foregoing) would seemingly impose both increased monetary and time costs to both Apple and the developers.
> Apple argued from the very beginning that the 30% was its fee for running the App Store, marketing the apps, and storing and delivering the app bundles. The in-app payment system was a convenient way for Apple to collect its commission and a way for Apple to create a unified payment experience for its customers, but it was never the Achilles heel for Apple's business model.
Is it just me or does this argument seem insanely flimsy? If Apple were serious about it then why aren't they charging free apps for downloads and approvals? Why doesn't the developer policy require Netflix to pay 30% of subscriptions for anyone who signs in on an Apple device? Why are the prices lower for "reader" apps who presumably cause Apple to incur similar costs?
Its like a toll road arguing "no, driving on the road is free of course, we just charge at the entrance and exit for the privilege of looking at the toll road".
What does it take for the legal system to be able to call BS on a claim like that?
I agree that it's an oddly-applied pricing system, but it's not unique. Apple's differential pricing functions similarly to student and senior discounts—it's an acknowledgment that some customers are harder to get than others and it's worth it to the company to meet those customers where they are.
Some apps don't make any money at all, and Apple wants to let those exist and so they get a free pass. For others, Apple is only providing a tiny portion of the value of the app, most of it comes from the content that the app licenses from other companies. Apple recognizes that they can't take 30% from those apps without them giving up on an app entirely, so they get a discount in order for them to stay on the platform.
Is it fair? Probably not. But I see no reason to believe it's illegal.
>Is it fair? Probably not. But I see no reason to believe it's illegal.
If they take it too far, that's how you get into antitrust territory. That's why Epic's court case against Google ruled in Epic's favor, as it was giving paying off devs to not make their own app stores and blocked OEMs from making deals with other studios.
So I'd say this puts apple on thin ground. I'm sure this won't be the last high profile lawsuit over the app store this decade.
This (a policy of charging some devs more/less than others) isn't Apple bribing devs to not compete with them, and it isn't a series of shady backroom deals. It's a relatively straightforward and transparent price discrimination scheme, and I have a hard time imagining why this would put Apple at risk of an unfavorable antitrust ruling if the complete lack of any alternate app stores didn't.
Where I imagine Apple could get into trouble is if they systematically turned a blind eye to commission-dodging by specific entities as part of a trade to ensure their market dominance. Unlike Google, though, I'm not even sure which entities Apple could bribe that would risk looking like a trust.
>'s a relatively straightforward and transparent price discrimination scheme, and I have a hard time imagining why this would put Apple at risk of an unfavorable antitrust ruling if the complete lack of any alternate app stores didn't.
Like any discrimination case, it depends on the subject of discrimination and potential victims. So I would say that discriminating with the largest streaming service can be a way to lock out the rest of that market from competing properly.
>Where I imagine Apple could get into trouble is if they systematically turned a blind eye to commission-dodging by specific entities as part of a trade to ensure their market dominance
Yeah, that's what I'm getting at. There's no hard evidence but that's what would be subpoena'd in court.
Ironically enough, Google is the biggest smoke signal here. Since court cases reveal they have some sort of deal with Apple to power search. That deal + potential discrimination with Google submitted apps can lead to those exact issues Google is under fire for.
The case against Google had a completely different fact pattern. One that resembles the US v MS more.
Google essentially pressured and bullied OEMs and other third parties into doing stuff that was beneficial to Google in exchange for licenses and special deals.
At that point, you’re throwing your weight around, something that Google “had” to do because they started with a relatively open platform.
Apple, on the other hand, preempted needing such tactics by making their ecosystem closed and heavily regulated from the onset when they were still nobodies within the market. That makes it extremely difficult to prove antitrust issues.
Had Apple, say, increased the commission from 30% to 33%, then it would’ve been pretty close to an open and shut case because then it’s easy to argue that Apple threw its weight around once everyone was inside the ecosystem.
But the opposite happened.
This is also one of the reasons why everything Apple does is restricted and limited from the onset. It’s always easy to loosen the reigns later, but at their size, you can never go the other way without risking antitrust liability.
FWIW, even MS, with their egregious behavior, got a lot thrown out on appeals and prevented being split up. The DOJ ended up settling instead.
>Its like a toll road arguing "no, driving on the road is free of course, we just charge at the entrance and exit for the privilege of looking at the toll road".
I mean, there's actually many toll roads/bridges that only charge for travel in one direction. The other is free, with the expectation that you'll need to make a return trip anyways.
Does Google Maps still assume that the toll applies in both directions? I used to live near a bridge like this and it was really annoying, because I had Google Maps set to avoid toll roads, but because of this it would refuse to plot a route over the bridge, even though there was no toll in that direction.
No, I'm really just asking what level of scrutiny can be applied to their claimed justification for the fees. I feel those examples are illustrative of how Apple's decisions aren't really aligned with their claimed justification. One could absolutely come up with a rational explanation (as some commenters have) even if it's not the actual explanation, I'm interested if that's all Apple needs to do to fend off claims of them exploiting their market power.
Obviously if they tried to charge 85% no one would actually be a developer and the App Store would crater. So they have a very strong incentive not to.
But from a legal point of view is there a reason why one number would be legal but another wouldn’t?
The only thing I can think of is a contract being determined to be unconscionable. Until they hit whatever threshold that is it seems like it’s completely up to them to set the terms at whatever they think enough developers will accept.
>Obviously if they tried to charge 85% no one would actually be a developer and the App Store would crater. So they have a very strong incentive not to.
That's not really true. If the iPhone became a real monopoly in the US, for instance, with perhaps 98% marketshare (similar to Windows before Macs started seriously challenging them), then Apple really could charge 85%. What is anyone going to do about it? They'd have a choice of paying 85% to Apple so they can sell apps to 98% smartphone users (basically everyone), or not selling smartphone apps altogether and finding a new business strategy that probably doesn't involve making software for consumers at all (which admittedly, many developers would probably choose).
What I can gather is that if Apple, from day one, had an 85% split, grew to 98% marketshare, then that would be ok. If apple started with 30%, then grew to 98% marketshare, then jacked up the price to 85% then they would have a problem.
I think the missing piece that most people miss is that it is not illegal to have a monopoly. It's illegal to use your monopoly to bully others. Apple did no such thing.
Perhaps, but I disagree about your supposition that "they would have a problem". I don't think they would. It may be technically illegal to use your monopoly to bully others, but enforcement in America these days is rare.
> Is it just me or does this argument seem insanely flimsy?
I'm not sure if it is just you, but both the district court and appellate court are on board with it. And honestly, I can see why.
Apple argued that they provide a bunch of services and access to their IP in exchange for $99/year and a commission over the sales.
The courts have deemed that an acceptable business model.
The district court was hemming and hawing a bit over the actual commission rate being set at 30% (15% for small devs) and at the fact that some developers essentially subsidize others but ultimately didn’t make a ruling on any of that in part because Epic didn’t bring it up as an argument.
The appellate court, however, went a step further and stated in no uncertain terms that it was kosher.
If you think about it, it makes sense. We see similar business models with differential pricing all over in commerce for various reasons.
Sometimes, it’s for goodwill, sometimes, to reach customers that would otherwise be harder to convert into a sale, sometimes, it’s based on usage and who puts the most strain on a system and sometimes, it’s for more egalitarian reasons.
Military discounts, student discounts or even free usage, senior discounts, teacher discounts, first responders, etc. These are all examples of differential pricing.
In particular, the student stuff is interesting because the philosophy there seems to be that as long as you don’t make revenue from it (commercial use), “we” don’t need to make a profit from you.
> It’s like a toll road arguing "no, driving on the road is free of course, we just charge at the entrance and exit for the privilege of looking at the toll road".
I don’t think the analogy is apt, but we see similar stuff on toll bridges.
I’ve got a bridge near me where toll rates are based on vehicle type and axles.
While the pricing is slightly higher for commercial vehicles (e.g., trucks), it’s not proportional to the increased cost of upkeep those vehicles cause.
Edit: Also realized that only one direction is burdened with tolls. The other way isn't.
> What does it take for the legal system to be able to call BS on a claim like that?
A very carefully crafted legislative change, I suppose, if possible at all.
Currently, with SCOTUS’ refusal to take up the case, this is standing law, and it’s challenging to craft legislation that wouldn’t have reverberating effects across all of commerce while simultaneously only hitting Apple.
Thanks for your reply, I definitely see what you mean with other pricing schemes and how there is pretty wide latitude for what type of price discrimination is justifiable.
I mostly just find it silly that at no point does anyone seem to address the elephant in the room that the only way to access some hundreds of millions of users is through Apple, and that almost certainly influences the fee in a way that can't be really be explained by the value of the IP.
Does the argument require us to believe the fee would still be 30% if iPhone had practically zero users? Or is that legally irrelevant assuming that they aren't found a monopoly?
> Does the argument require us to believe the fee would still be 30% if iPhone had practically zero users? Or is that legally irrelevant assuming that they aren't found a monopoly?
While not zero users, the default fee has been set at 30% since the beginning of the App Store, long before Apple had the level of market dominance it has today.
This argues in favor of it being acceptable: developers were willing to accept that fee without monopoly pressure being applied, since nobody has successfully argued that Apple held a monopoly in 2008.
If all the developers I assume you care about left the App Store, Apple wouldn’t care. The apps that make the majority of the money on the App Store are slimy pay to win games where “whales” buy coins and loot boxes.
The other popular apps are front end for services where Apple doesn’t collect a dime like Facebook, Instagram, Netflix, etc.
I'm on Android and get most of my apps through F-Droid. I don't have any stake in this fight at all, I'm just an observer who's been a bit baffled by the conclusions that people have jumped to.
Sure, in the same way every website has the option to make it's own social media website. The website is the "easy" part but not necessarily the most profitable point to pitch to companies like Apple.
What do you think is more likely? People wouldn’t buy iPhones or people would find an alternative to Instagram?
Especially in the US, how likely is it do you really think iPhone users are going to sully themselves and buy Android phones when many people think that “only poor people buy Android phones”. (Note sarcasm)
> What do you think is more likely? People wouldn’t buy iPhones or people would find an alternative to Instagram?
It is an interesting question that I would love an answer beyond a hunch.
I would think a larger percentage would stay on iPhone and look for an insta alternative, compared to the percentage who might move on to a different phone for insta.
But what would those numbers look like? Any case studies or similar changes? Maybe in game consoles?
The two classes of people who broadly buy Android phones are techies (“I want to root my phone”) / politicos (“software freedom! walled gardens! it’s GNU/Linux actually”) and committed cheapskates (“close enough to an iPhone for no bucks!”). There’s nothing wrong with that. But the actual working poor don’t have time for it, so they buy iPhones and just keep them as long as possible.
Yeah, the amazement amongst people here on HN amazes me.
The district court was crystal clear about this in their judgment, which at the time caused quite some consternation.
The appellate court then affirmed the same and even clarified more clearly that it’s completely fine because it primarily is the mechanic Apple gets payment for the use of their IP and, secondly, their services that encompass more than just payment processing.
In fact, if you read the appellate judgment, the annoyance towards the district court is palpable.
The annoyance stems from the fact that the district court states in their judgment that alternative ways of collecting the commission aren’t worth considering and expanding on because of how onerous they are (retroactive audit, collection efforts, etc.) while at the same time causing exactly that by striking the anti-steering provision and opening the door to third-party payment providers.
The appellate court doesn’t go further than expressing annoyance between the lines because, ultimately, the district court didn’t err substantially enough for the appellate court to step in, which is ultimately the bar that needs to be met.
Appellate courts aren’t meant to relitigate cases, after all.
Now that the Supreme Court has put this issue to rest by refusing to weigh in, will the appellate court now take that until the district court to figure out those kind of details?
Or will everything stand as it is at the moment with figuring out specific details that Apple must abide by that haven’t already been listed up to future lawsuits to determine?
The appellate court affirmed the judgment by the district court, albeit while making some comments here and there.
So as it stands, the appellate court’s decision is the law of the land.
Technically, from a legal perspective, there is a small chance this changes if a case makes it way to an appellate court in a different circuit and they’re in the mood to come to a different conclusion, at which time SCOTUS might be inclined to take up that case to resolve the contradictory outcomes, but those are pretty slim for a couple of reasons.
One, it’s not likely a new case would play out outside of California, by virtue of Apple being located there.
Two, a court of appeals of a different circuit would need to be in the mood to completely disregard the 9th circuits conclusion. While technically an option, most appellate courts don’t want to contradict their sister circuit, but there are some “activist” courts out there.
Three, the outcome needs to be sufficiently different for it to cause a significant contradiction.
And lastly, the fact pattern of the new case would need to be extremely similar to the Epic v Apple case.
> The appellate court then affirmed the same and even clarified more clearly that it’s completely fine because it primarily is the mechanic Apple gets payment for the use of their IP and, secondly, their services that encompass more than just payment processing.
This completely ignores Apple's market power though. Because what stops Apple from making this 40% or 50%? 30% is a fair price? Look what they did to Spotify with Apple Music. They absolutely abused their ownership of the platform to stifle a competitor.
Also, things change when you effectively become a utility. Apple shouldn't be able to hide behind their "aww shucks, we need the 30% to keep the lights on" routine.
> Because what stops Apple from making this 40% or 50%? 30% is a fair price?
Competitive pressure. 30% is pretty in line with what other platforms charge.
Apple has had the same 30% ever since it launched the App Store, back when it was much less dominant. They presumably picked it as a level that would make revenue but also not deter developers.
Collusion is the ugly cousin of monopoly. If you can't get a monopoly, work with your few competitors to set an industry standard fee in which you all make a killing and can claim the plausible deniability of "fair market value".
> There’s no world in which Nintendo and apple are colluding to set rates.
What makes you say that? And short of direct collusion, is it fair game if Apple sets the precedent and Nintendo follows suit without direct coordination? If the agreement is only alluded to without being directly stated, are we okay with the ethical precedent regardless of legal standing?
> Apple has had the same 30% ever since it launched the App Store, back when it was much less dominant. They presumably picked it as a level that would make revenue but also not deter developers.
They picked 30% because that was the iTunes Music Store cut. The iOS App Store was a direct clone of the iTunes Music Store in almost every way. It even existed inside iTunes for years. As a developer, I can still see "iTunes Connect" in some obscure areas of App Store Connect.
The documents from the Epic trial showed that the App Store was thrown together very quickly. Initially, Steve Jobs didn't even want third-party apps on iPhone and had to be convinced to add them.
> That doesn’t seem relevant to the question of whether Apple’s fees are in line with fees on other platforms such as on video game consoles.
I've never understood why video game consoles are the relevant platform. iOS is a general-purpose computing platform more akin to Mac and Windows. Indeed, iOS was based on Mac OS X. As an Apple user, I don't even play video games, on either iPhone or Mac. And as an Apple developer, I don't write video games either. Games are 100% irrelevant to my computing life.
> Plausibly iTunes 30% was chosen because it met the same goal: high enough to earn a good amount, low enough music companies found it compelling.
The problem is that the iTunes Music Store was based on selling 99 cent songs. 30% of that is just 30 cents. Before the App Store, computer software was almost never in the 99 cent price range.
> I've never understood why video game consoles are the relevant platform.
From the courts’ perspective, it isn’t. The relevant market definition, as established by the courts, is digital mobile gaming transactions.
I’ve called into the District Court’s hearings almost every day, and many days were spent on determining the relevant market, but the long and short of it is that this definition was chosen because:
- The impetus of the case was Fortnite
- Epic was unconvincing in establishing their EGS was more than just a gaming storefront, which limited the scope of the case to gaming
- the court established that free-to-play games generated the vast majority of the App Store revenue
You also have to remember that the court can’t just hand out judgments that affect things beyond the case in front of it.
This case was Epic v Apple and not, say, a class action by multiple app developers, so the court's conclusions will be limited to the facts that pertain to those two parties.
In other words, other markets might exist, but they might not be relevant to the case at hand.
Additionally, civil courts prefer to split the baby; in this case, this seems to be a middle ground between Apple’s proposed relevant market (games in general) and Epic’s (Apple’s App Store).
An interesting tidbit is that Nintendo’s Switch made a minor cameo of sorts because you can make transactions on it on the go (i.e., it's mobile). Still, the main competitor, according to the court, was Google, leading the court to conclude that Apple is primarily in a duopoly with Google.
Personally, I think video game consoles would be part of the relevant market because of the similarities in market dynamics. The way the payment for IP is structured (commission), the way entry to the market is managed (certifications, similar to app review), the way there’s a single brand market (i.e., monopoly by manufacturers), etc.
While the purpose of the devices might be different, the underlying products are the same (software), and the market mechanics are nearly identical.
Even the platform limitations are artificially created by the platform holder (i.e., what you can and can’t do on iOS is artificially limited, just like what you can and can’t do on consoles is artificially limited by Sony and Microsoft).
Drilling it down further, you’ll find that on Xbox, you have access to non-gaming apps, and plenty of people use their iPads as a game device for their kids. Further blurring these lines of purpose.
> As an Apple user, I don't even play video games, on either iPhone or Mac
You might not, but it wouldn’t come as a surprise to you that others might.
I, for example, play games on my Apple devices, as do others in my household.
> And as an Apple developer, I don't write video games either.
Same here. I mainly write apps, but I dabble in games and know plenty of other devs who make games.
> Games are 100% irrelevant to my computing life.
What I’m trying to say is that anecdotal arguments aren’t solid. This is not a dig at you; mine aren’t either.
> The problem is that the iTunes Music Store was based on selling 99 cent songs. 30% of that is just 30 cents.
I don’t follow this logic.
Does it matter if $300,000 is extracted via a million $1 transactions or 10,000 $100 transactions?
Ultimately, you end up paying $300,000 in commissions.
> Before the App Store, computer software was almost never in the 99 cent price range.
There’s a lot to unpack with this simple statement.
First is, of course, that the race to the bottom is a pro-competitive symptom.
If we, as devs, didn’t have to compete so hard, we wouldn’t have to sell our software at low prices.
Ironically, this is good for consumers, but the devaluation of software isn’t so great for us developers.
Secondly, this, of course, undermines your iTunes $0.99 argument. Whatever it used to be, it’s now the same as with songs via iTunes.
Does this mean you’re ok with the 30% commission or ...
> Does this mean you’re ok with the 30% commission or 15%, whichever applies to you? This is why I’m saying I have a hard time following your logic because I guess I don’t know exactly what you’re trying to say.
Let me start with this, because it may clarify a lot. I qualify for the Small Business Program 15%, and while I think that Apple's developer services are totally crappy and not even worth 15%, from my perspective the cut is not among the App Store's biggest problems, and I would happily pay an even larger cut if I actually got a good return for the investment.
My goal was merely to highlight the historical origin of the App Store, which is important in understanding how we got to this point today.
> The relevant market definition, as established by the courts, is digital mobile gaming transactions.
As invented out of thin air by Yvonne Gonzalez Rogers. But I'm not really interested in arguing the legalisms. I think the decision was bad, but that's par for the course in our legal system. I'm more interested in the public debate over the issue, here on Hacker News, on social media, in the news media, etc. Regardless of what the judge decided, the people in the public who defend Apple often point to gaming consoles and consider them to be the relevant platform.
> What I’m trying to say is that anecdotal arguments aren’t solid. This is not a dig at you; mine aren’t either.
I'm not sure what you think I was arguing, but it was simply that iPhone is a general-purpose computing device. Of course gaming is one of those purposes but definitely not the only purpose. Indeed I would argue that gaming is not even the main purpose, because after all, iPhone shipped in 2007 with zero games, and while Apple has created a lot of apps for iPhone, Apple has created almost no games for iPhone. (I think they had a Texas Hold'em game way back in the day, and they also made Warren Buffett's Paper Wizard.) I wasn't trying to deny that people use iPhone for gaming; that would be a silly argument.
You can argue that gaming consoles have some additional capabilities besides games, but does anyone ever buy a gaming console who doesn't play games at all? That would be silly and pointless. Yet huge numbers of people buy iPhones and iPads and Macs with no desire to game on them. Thus, I argue that those are general-purpose computing devices, unlike gaming consoles.
> Does it matter if $300,000 is extracted via a million $1 transactions or 10,000 $100 transactions?
Yes. 30 cents is actually a very good deal for a 99 cent transaction. I don't think you'll find a better one, and many payment processors would charge 30 cents plus a percentage. At least as far as payment processing is concerned, though, 30% is a crappy deal for a $100 transaction. So the question is, how much does the App Store add to the value above and beyond payment processing? I would argue, not much in most cases.
> Ironically, this is good for consumers, but the devaluation of software isn’t so great for us developers.
I dispute that it's good for consumers. You get a different type of software in a race-to-the-bottom market. When the platform makes it difficult for developers to produce quality, well-crafted, sustainable software, you get exploitative crap instead, and I think the epithet "crap store" is richly deserved.
You can really see the difference in the Mac App Store, because on the Mac, developers don't have to be in the App Store, and quite a few important apps are missing entirely.
It didn't have to be that way. The iTunes Music Store model was a very poor fit for software. For example, the "top charts", based on unit sales, was one of the main ways to get noticed in the App Store and was a big reason for the race to the bottom. The top charts are tolerable for music, where every song and album is more or less the same price, but it doesn't work well for software, t...
I appreciate your clarifications, in some cases it seems I misunderstood what you were saying.
> I qualify for the Small Business Program 15%, and while I think that Apple's developer services are totally crappy and not even worth 15%, from my perspective the cut is not among the App Store's biggest problems, and I would happily pay an even larger cut if I actually got a good return for the investment.
I’m sorry you’re unhappy with the services and tools offered in exchange for the commission.
As I stated before, I was already happy with what I got for 30%, the 15% is a cherry on top for me.
I’m one of the few (it seems) that’s very happy with Xcode and its improvements, I’m also very happy with the advancements made on frameworks and SDKs over the last decade or so.
It has made my work so much easier and without many of the latest improvements much of what I currently do wouldn’t be possible.
Code level DST support has also proven to be invaluable to me.
> As invented out of thin air by Yvonne Gonzalez Rogers. But I'm not really interested in arguing the legalisms. I think the decision was bad, but that's par for the course in our legal system. I'm more interested in the public debate over the issue, here on Hacker News, on social media, in the news media, etc. Regardless of what the judge decided, the people in the public who defend Apple often point to gaming consoles and consider them to be the relevant platform.
It’s not invented out of thin air, but based on well established case law and legal principles.
I used to practice law between my original stint in software and my current career in software and based on my legal knowledge I’d say that both the original judgment as well as the affirmation by the appellate court is a logical and sound legal conclusion.
But I understand that you’re mainly interested in the “every man’s discussion”, that’s fine.
> I'm not sure what you think I was arguing, but it was simply that iPhone is a general-purpose computing device.
I’ve addressed this both from a legal perspective as well as my personal perspective.
I think it’s safe to say that no new insights can be gleaned from a back and forth and we just fundamentally differ in our views on this.
> Yes. 30 cents is actually a very good deal for a 99 cent transaction. I don't think you'll find a better one, and many payment processors would charge 30 cents plus a percentage. At least as far as payment processing is concerned, though, 30% is a crappy deal for a $100 transaction.
I don’t think it makes much of a difference when taking volume into account. The “pain” is the same, it’s only a matter of difference to how it feels.
> So the question is, how much does the App Store add to the value above and beyond payment processing? I would argue, not much in most cases.
Perhaps not with that framing, I’d argue the question is really how much does Apple as a company add to the value as the commission structure first and foremost serves as payment for being able to use their IP.
The answer is easily found I’d say, try and reinvent the wheel for yourself, leave as many frameworks to the side and let me know how it goes.
For me SwiftUI alone is worth its weight in gold given how much time it has saved me.
> I dispute that it's good for consumers. You get a different type of software in a race-to-the-bottom market. When the platform makes it difficult for developers to produce quality, well-crafted, sustainable software, you get exploitative crap instead, and I think the epithet "crap store" is richly deserved.
I don’t agree with you on this either. I’d argue that the golden age of apps is here, if only because of the many high quality indie apps.
Something that would’ve been impossible without the available tools and frameworks, something that was completely absent in the software market decades ago.
> 30% of $100 is $30. 70% of $0.99 is $0.69. I'll happily take the...
> I’m one of the few (it seems) that’s very happy with Xcode and its improvements, I’m also very happy with the advancements made on frameworks and SDKs over the last decade or so. It has made my work so much easier and without many of the latest improvements much of what I currently do wouldn’t be possible.
> Code level DST support has also proven to be invaluable to me.
You're talking about things that have nothing to do with the App Store. These same tools are used by Apple to make their built-in software. They're also used by Mac developers outside the Mac App Store.
I'm talking about the App Store itself, as well as tools and services directly related to the App Store, such as App Store Connect.
> The answer is easily found I’d say, try and reinvent the wheel for yourself, leave as many frameworks to the side and let me know how it goes.
> For me SwiftUI alone is worth its weight in gold given how much time it has saved me.
Again, you're talking about things that have nothing directly to do with the App Store. The iOS and macOS system frameworks are not the App Store and would exist even if the App Store were eliminated.
> Something that would’ve been impossible without the available tools and frameworks, something that was completely absent in the software market decades ago.
Same thing here. Nothing to do with the App Store. And in any case, they were available decades ago. Xcode is 20 years old. UIKit is based on AppKit, which itself originally came from NeXTSTEP over 30 years ago.
> But pushing 100 units at $100, leaving you with $300 is less than pushing 1000 units at $0.99 leaving you with $690 and that’s a conservative estimate.
Your math is wrong. 100 x $30 = $3000, not $300.
Anyway, indie developers can't "make it up in volume". One of the most difficult things for an indie developer is marketing and getting discovered by customers. That's why we need sustainable prices. Not to mention paid upgrades.
> You can choose to ignore that part, but that doesn't change the fact that everyone and their mom was cheering for a 30% haircut and a simple publishing process after having gone through hell with carriers.
Was the pre-iPhone mobile software market even as big as the Mac software market? I'm skeptical. It certainly wasn't as big as the Windows software market, which is also open. Open platforms were the norm.
> Because what stops Apple from making this 40% or 50%? 30% is a fair price?
Market. It's capitalism, you know.
They provide users to devs (e.g. in case of Epic most people played Fortnite from iOS) and they provide apps to users. If they jack up the price and devs quit, the deal stops being attractive to users because there's not enough apps so Apple risks losing users unless they make selling apps appealing to devs again.
> Look what they did to Spotify with Apple Music. They absolutely abused their ownership of the platform to stifle a competitor.
Everyone I know on iPhone is using Spotify except me so for me it is hard to see who is stifled exactly...
There is no current iOS version of Fortnite. The only way to do it is with Amazon Luna or Xbox Cloud Gaming, which is only "playing Fortnite from iOS" on the very surface.
> There is no current iOS version of Fortnite. The only way to do it is with Amazon Luna or Xbox Cloud Gaming, which is only "playing Fortnite from iOS" on the very surface.
It's not there anymore but it was there originally. (It'd be amazing if it still were. If you were allowing me to sell my game in your store for a fee, and I stopped paying the fee AND sued you, you'd remove me from the store first thing. First to avoid funding my legal expenses and second because I agreed to your ToS that allow you to do it literally for any reason you like.)
After it was removed, Epic found out that people who were casually playing Fortnite on iOS were not about to start buying PCs and gaming consoles. After all there are other games in the store, including tons of buy-once-play-forever games which don't leech money off you or your kids like Fortnite does.
> More than 116 million registered users have accessed Fortnite through iOS -- more than through any other platform, Epic said in the filing
Thats playing Fortnite! In what ways isn't that playing Fortnite? The GPU is in the cloud, but other than that, it's the full game, not some knock-off lite fake version.
> This completely ignores Apple's market power though.
Market power has little to do with the legality of a business model at first blush. Only in very narrow circumstances might it be a relevant factor.
In this case, market power doesn’t matter at all, no matter which angle you approach it with.
For starters, fundamentally, market power doesn’t preclude a company from extracting payment in exchange for their services and IP. This is what both courts explicitly (re)affirmed.
And that makes sense, of course; just because you’re big doesn’t mean you can be forced to give your stuff away for free.
From an antitrust angle, market power mainly starts to matter once you abuse that market power.
Here, all signs on the commission point the opposite way.
Apple introduced the 30% commission and the strict App Store rules around the same time the App Store was launched, at which point they had no relevant market power to speak of, so that was not an antitrust issue.
The parties quibbled a bit about at which point Apple gained market dominance because that’s a relevant measuring point to establish antitrust issues. Still, regardless of wherever you place that starting point, it is clear that Apple didn’t use that market power to turn on the screws.
They didn’t, say, increase the commission or impose more onerous restrictions.
The opposite happened.
They first introduced a commission discount of 15% for subscriptions after the first year, and later on, they introduced the small business program that provides a 15% reduction to developers with less than $1M in revenue, which, as I understand it to be, covers about 90% of the developers.
These moves, whether for altruistic reasons, goodwill reasons, or fear of regulatory action, are the opposite of abusing one’s market power.
I think that Apple is quite aware of this risk, which is why they always introduce things minimally and strictly, because that gives them the option to assess and decide to loosen up things, whereas the opposite isn’t possible; they can’t impose more restrictions due to the potential antitrust issues at their current size.
Moreover, courts aren’t eager to retroactively punish just based on success.
The way the courts see it, it’s almost self-evident that Apple wasn’t acting in an anti-competitive way with their commission.
From their perspective, if Apple was able to enter a market as a nobody (or create it even, if that’s how you want to look at it) with such restrictive rules and with a commission rate that is now considered high (even though it was a significantly lower commission than what was standard at the time) and still managed to capture a good chunk of the market as they did, then there must be pro-competitive forces at play, even when it’s hard to quantify them.
Again, the way they see it, if it all were so terrible, then nobody would’ve signed up for it in the first place. So, there had to be a pro-competitive benefit that outweighed all of those negatives.
> Because what stops Apple from making this 40% or 50%? 30% is a fair price?
Competition in the relevant markets as defined by the court? Antitrust violations? Pick your poison.
Courts generally don’t care much for hypotheticals because hypotheticals can’t be remedied, and it doesn’t feel good to dole out punishments for things that could be.
Courts tend to limit themselves to what has happened instead of what could happen.
That’s not to say they don’t look at it at all. In this specific case, they’ve looked at the competitive effects and what would stop Apple from doing X, Y, and Z in their test to establish how much competitive pressure Apple is under to understand the motivations behind some of Apple’s actions.
But ultimately, unless Apple does the thing you fear, they can’t punish it.
> Look what they did to Spotify with Apple Music. They absolutely abused their ownership of the platform to stifle a competitor.
I’m looking, but I don’t see much.
Of course, t...
> Apple argued from the very beginning that the 30% was its fee for running the App Store, marketing the apps, and storing and delivering the app bundles.
The cost of operating an App Store and providing distribution is relatively negligible. Several Linux distros have app stores, and package management and distribution systems that are as good or superior than Apple’s.
The annual fee that Apple charges developers alone should more than cover the cost of App Store. It is not something that costs tens of billions of dollars.
It's not about the cost of the App Store, it's about maximizing profits and generating shareholder value. How is Apple supposed to have the most valuable stock in the world without raking independent developers over the coals?
The cost of a human working all day is negligible; they need a little bit of food. And yet they still expect to be paid - sometimes quite a lot.
Just based on your quote and without having much interest in the case... the fee isn't about covering costs. They have an app store, people want to be in the app store, and Apple is going to charge them a fee to be in the app store. Similar logic to drawing a wage.
This is bad analogy. A person who works provides services or labor worth a certain amount of value in exchange. Often that value exceeds the wage. For example, a software engineer $3000 "worth" of work in a day, but only gets paid around $1000 for that day. I understand the worth/value is a difficult thing to measure.
So Apple is more like the Mafia. The threaten negative/adverse action, if you don't pay them.
Also, historically, software could be installed on computers without the permission of an overlord. I'm aware iOS & game consoles are glaring exceptions.
I see the argument that people should be allowed to install whatever they like on their phones as very strong. However that has nothing to do with Apple's fees, costs or value add. It might seem pedantic, but the separation of value and cost is fundamental to how everyone improves their material wellbeing and needs to be protected.
And the argument that Apple is like the Mafia because they can exclude you from something would cast most businesses and all landlords as Mafia-like. That is a position some people hold, but if mafiadom is so embedded and accepted in society it undermines the idea that Apple's is a unique problem and that it will be acted on.
My main point is: on a desktop/laptop personal computer, you can install software without any overlord's permission. On iOS, you can't. That's seriously messed up, and wrong. And, yes, a lot of business (and landlords) are Mafia like. I'm hoping for a strong left-wing party to come into power in the future, and completely turn this upside down.
That's odd. I would have presumed that there are non-negligible costs involved with hosting and pushing binaries and updates of hundreds of apps per phone, times 1.5 billion active iPhones.
Apple is sitting on a $150 billion warchest of cash. I'm guessing that some of that comes from what they're charging above these non-negligible costs. They don't have to run a charity, but they're making fucktons of money between all their products so it's hard to see their 30% cut as anything other than extortion.
That cost is negligible relative to the tens of billions they rake in via fees charged to iOS app developers. You could do the math, but I'd guess it most likely wouldn't even exceed $10 million a year.
What marketing specifically? Last time I checked, I had to integrate third party ad experiences in order to market my app in their ecosystem.
> In such a hypothetical world, developers could potentially avoid the commission while benefitting from Apple's innovation and intellectual property free of charge.
> Apple argued from the very beginning that the 30% was its fee for running the App Store, marketing the apps, and storing and delivering the app bundles
With hindsight of the antitrust case in the EU this argument itself seems like it is in bad faith. Apples argument in the EU against antitrust was that there isn't one but five different app stores, conveniently for each device family.
So they are indeed aware that a commercial app developer would likely not be "benefitting from Apple's innovation and intellectual property free of charge", because they are likely not taking advantage of their entire catalogue of intellectual property (if there is five different app stores, for five different markets, as per Apples argument, surely there is different IP between those markets to run the app store in an effective manner).
In other words, as others have mentioned, Apple charges a 30% flat fee for "intellectual property" that developers may or may not take advantage of, as per their own argument overseas. I don't see how it's not antitrust when a company forces me to pay for services that I am not taking advantage off or ever had the intent of using, or can't use, due to technical limitations.
As a developer, to me it rather feels like Apple is trying to artificially bind me to invest into the app store as a platform due to this high fee, for example by developing an accompanying watch applet or a tablet version of my app, because the act of simply offering these on their devices seems to be part of their precious App Store IP. And you can't argue that pricing these add-on apps differently would make a difference for Apple, since they collect the 30% cut across income in their entire ecosystem either way.
It also doesn't make sense for Apple to tell me to go elsewhere (Android) to mitigate this, as I can't replicate the UX of their ecosystem on my own even if I tried (prime example would be the peripheral integration imo. You'll find creating a device that integrates as seamlessly as the Apple Watch fairly hard, not because Apple has some special proprietary integration IP secret sauce, but because they artificially lock down ways to interface with peripherals to secure market dominance).
> The Court presumes that in such circumstances that Apple may rely on imposing and utilizing a contractual right to audit developers annual accounting to ensure compliance with its commissions,
To this day it remains absolutely unbelievable to me that anyone would ever agree to this. I always have and always will tell Apple to shove their app store up their ass. Plenty of other ways to make a living in software.
One thing I haven't seen anyone mention which I think is the most obvious reason for commission on outside purchases: if Apple did not charge a commission on purchases made outside the app, it would leave a huge loophole - developers could just list their apps free on the App Store with limited functionality, with a link to an outside purchase to fully activate them.
As a user, if I go to buy something in an app and it asks me to punch in my credit card number or sign in to some payment processor instead of just the usual "double click to apple pay", there is a very high chance i will just change my mind.
A 30% discount changes things, though for most developers it would be closer to a 10% discount, since they normally only pay Apple 15% and still need to cover the 2-5% their alternative payment processor charges. If it's a recurring payment (i.e. subscription), I would still be inclined to pay the full Apple price simply because they make subscription management much easier than anybody else.
apple just has really good marketing and massive support from its fanboys, compared to the olden days of Microsoft monopolistic behavior, Microsoft is less shiny with less loyal foot soldiers.
Just wait until you see what you have to do to get your food product onto super market shelves...
And grocery stores are not even considered a monopoly!
Edit: which is not say that there should be an "is" vs. "ought" conflation. Just that it's unlikely that this situation is going to be changed through courts. Other routes: legislation and regulation to establish a new social norm, or as Jacquesm has been advocating here, collective bargaining. But as an App Store consumer, and a developer of other sorts of tools, I don't really care at all about the developer-Apple split and am not the least bit excited by whatever might happen should that switch to, say, 99% going to the developer. Even if developers dropped prices 30%, I would have a hard time caring!
My experience at farmers markets tells me that I would be paying more than 100% more for the privilege of interacting with somebody that gets employed by the farmer instead of somebody employed by the store.
The analogy would work better if the grocery store sold me some sort of platform for cooking food, that only worked with certain types of food... I don't know, it's hard to find the analogy compelling at all.
People develop for the App Store because they get access to a particular customer base. I could definitely support some sort of customer protection that forces side loading options (but they must be options and easy to disable and hard to enable, otherwise it destroys one of the best aspects of the phone.) But as far as caring for slight changes in percentages for app developers, well, I don't care about that one bit at all, anymore than I care about Apple getting a "fair" deal from the other businesses it interacts with.
this is what happens when the company controls their platform. In the technical sense, it's not monopoly, but surely if you squint a bit, it looks like it.
This is why i am only ever going to produce web based apps. I will not buy into a platform - even android has the same issue, albeit less severe (only because google does not completely control the android ecosystem).
Isn't that a defining trait of a monopoly position?
"If you don't like it then alternative is your target market is cut by over 50%"
Not a great argument. When you essentially have the say as to whether a company can afford to exist then you have serious control over a "free" market.
What is the target market? IPhone users? What's preventing the developer from shipping their app as a web app? The developer can still reach their target market.
Apple likely has a pretty good idea of how many downloads you have, and if users enable "Share with Apple Developers" in settings -> privacy -> analytics, their App Store Connect database definitely has usage and open analytics. Mobile app games likely won't be able to claim "we only made $30k this month on iOS" if they have >1M downloads a month or 100k app opens a day, for example.
Given the zeal Apple has for their 30%, they absolutely will be demanding fully open books and tracking for that outbound link.
There's no firsthand knowledge because this is the first time Apple's actually had to chase companies for the fee. In fact, their whole argument against Epic was that banning steering made it easier on both parties to attribute revenue.
People are focusing on the 27% cut, but a page worth of restrictions on how you’re allowed to link to your own website is just complete bullshit.
> In accordance with the entitlement agreement, the link may inform users about where and how to purchase those in-app purchase items, and the fact that such items may be available for a comparatively lower price
The fact that you must apply for permission to tell your users that you even have off-app purchase items is bullshit.
Apple’s welcome to make the rules of their own platform (within reason), but it’s garbage that developers aren’t even able to say the rules exist. If Apple believes they’re so right and just, why must they leave users uninformed?
What’s the good faith argument for any of this? I want to see Craig Federighi on stage at WWDC announcing and this revolutionary new "link" API, demoing how great the scary warning screens are.
This feels like a straw that breaks the camel's back kind of moment. Apple has gotten away with a tremendous amount (being an astonishingly greedy company. All companies are de facto greedy, but Apple is just next level in its egregious entitlement), but there is simply zero way this stands.
And FWIW, I'm an Apple fan and find Tim S a completely unsympathetic character. But seeing the hilariously absurd lengths that people will go to justify Apple's outrageous greed grows old.
The details of the process of getting approval for links may be out of line, but the idea that simply using a different payment processor would remove the entirety of the 30% commission was always a pipe dream. Apple has always been adamant that the fee is for the service of using the App Store, not the payment processor, and that you owe them for sales made regardless of whether they're able to take the money directly out of your revenue stream.
That part of this outcome was inevitable, and I don't think any court will rule against it. It was even anticipated in the original ruling:
> First, and most significant, as discussed in the findings of facts, IAP is the method by which Apple collects its licensing fee from developers for the use of Apple’s intellectual property. Even in the absence of IAP, Apple could still charge a commission on developers. It would simply be more difficult for Apple to collect that commission.
That's precisely what gets them in trouble though. Every bank, credit card, giant corporation has an app and has to pay Apple nothing but indie game developers subsidize them
Because the fee is only charged for digital goods yada yada Apple legalese. It's not 30% of every time money moves when an iPhone is involved. Indie devs are still processing credit card payments so I don't think this argument follows.
> Apple has always been adamant that the fee is for the service of using the App Store, not the payment processor
So charge developers for the service of using the App Store, perhaps with a per-download cost. To "give away" the service of the App Store only to recuperate your costs (and then some) via payment processing is just daylight robbery.
In the US, highways are almost all free but ”payment” is roughed charged through gasoline taxes. You also pay for sewage service based on how much water you use, not how much sewage you produce, based on the assumption that most of your water goes into the sewer.
Charging customers by some other correlated proxy is not robbery; it’s just practical. Which is exactly why the court had no issues with the arrangement.
The issue isn’t how Apple bills for their services, but rather whether they should be allowed to force every app developer to even consume them, at least to the extent they currently do.
Given that this is the US legal/political system, that question is being fought out in various proxy fights, but by looking at the largely equivalent situation in the EU and the DMA, you can see what’s really at stake here.
＞ the idea that simply using a different payment processor would remove the entirety of the 30% commission was always a pipe dream
The idea wasn't to use third party processors as an argument to evade the fee, it was the other way round. Front and center Epic wanted to get rid of or strongly lower the fee, and as a consequence developers would probably have had to use other processors.
The judge shut this down by legitimizing Apple's 30%, which as a consequent allows Apple to collect that money however the dev processes their customers, third party PSP or not.
Right, it wasn't Epic's pipe dream, but somehow that's the idea that got popularized on HN and elsewhere. For example, just a few hours ago the comments on the thread about the Supreme Court's declining to hear the case [0] were mostly operating on the assumption that developers would now be able to offer a substantial discount for people selling off the App Store.
That only works if developers actually could save significant money by selling through alternate storefronts, which was never going to be possible because Apple was always going to pick something approximately market rate as their valuation for the payment processor portion of the fee.
> It seems easy to kind of shrug at this, but this does seem quite significant because of many mobile apps are 'free to play.' Apple pocketing 30% of all of these transactions, and forcing users/devs to go through Apple, is a major part of its revenue. And all of those apps now have the option to direct users to alternative payment methods, where they can both charge users substantially less and make more profit doing so.
Assuming iOS is really vastly better than Android: Isn’t it curious that Google is charging exactly the same rate then?
It’s just not an apples to oranges comparison: One vendor is forcing use of their distribution services; the other just strongly nudges their customers to stay within their walled garden and not enable sideloading.
Does a gas station “get away” with charging for gas? They are selling a service and can charge anything they want for it. You are free not to use it, as is anyone else.
That would be true in a completely unregulated market only.
In many countries, antitrust regulators set some limits to how far companies can take their “take it or leave it” approach and in many cases require companies to provide a certain service, sometimes even at a certain rate.
Forcing companies to unbundle products or services is another common measure.
It’s called “nuance”. Also, Stockholm Syndrome is the opposite of what you’re objecting to; someone is taken hostage and sympathizes with the hostage takers.
> And FWIW, I'm an Apple fan and find Tim S a completely unsympathetic character. But seeing the hilariously absurd lengths that people will go to justify Apple's outrageous greed grows old.
Heh, there are still folks who actually grasp nuance… I have an iPhone, despise Apple in general, but consider their business disputes on a case-by-case basis. So for example, Apple is right to ignore Facebook’s plea to be allowed to track users, and simultaneously wrong in its App Store monopolistic money-grabbing.
Generally for Apple, I like their hardware, not their software. It's why I have a MacBook but also an Android phone, because I like their battery life but also because I can install whatever software I want, on either.
Feel free to correct me if I'm wrong on this. Consider the following scenario:
Developer puts out ads on Facebook (or some other way of getting traffic). Traffic flows to the developer's checkout page, where they buy access to in app content on an external website. Then they are linked to the app store where they can download the app and access the content.
Apple is paid no commission on this transaction. They only require commissions paid when the customer is sent to the website FROM the app store and checks out within 7 days.
If this is in fact true, then payment / support service recommendations would be great to hear right now!!
I think 30% commissions for Apple are fair if the customer found the app through the app store. If they clicked a deep link that took them to the app directly, the commission should be much lower like 10%. And in categories where Apple has competing digital services it should always be 3% to not be anti-competitive.
What a bloody pile of mess. In order to guard their interest, and everyone wants a pieces of it, now we have an Apple ecosystem that is... just ugly. And it is only gong to get worse.
I often wonder had Apple lowered their In-App purchase to 10% would we still have the same problem.
If you are are ok with this you should also be ok with Apple taking a cut on anything you buy with their browser, why not also take a fee for any data going in and out of your phone.
I’ve said this before and I’ll say it again. If the web was invented today browsers would never be allowed on the App Store. Not even a dumbed down version without advanced scripting capabilities.
The fact that they have a browser and allow “3p browsers” is only because the web was already established and customers wouldn’t have bought in without it.
iPhones and iPads are not general purpose computing devices. Not by tech, but by policy.
Any single application on iOS(/iPadOS) that allows you to browse the Internet is in some way based on Safari. The in-app browsers are just using one of the webview UI elements based on Safari/WebKit instead of opening up Safari.
I used CompuServe in the 90s (user ID 76760,1543 here; why do I remember useless things like that...), and it was fantastic to be able to ditch it for a generic, competitive, local ISP, where I could get on the internet using open, standardized protocols.
Making things proprietary when they should be commodities is a step backward, and we should fight that, tooth and nail.
OP's point is that it's not, which is why Apple is begrudgingly allowing it. But if they could make you use apps for everything instead of a browser, they would. And they'd use all the same arguments they do today wrt not allowing sideloading etc to justify it.
Keeping in mind what a browser could have been in 2024 if Apple hadn't disallowed/slowed innovation, it's fair to say browsers aren't allowed on the App Store.
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[ 3.7 ms ] story [ 395 ms ] threadThis is a huge win for the developers, despite that pesky warning. They can still ask users to circumvent apple pay/in-app purchases and get away by not giving a revenue cut to Apple.
They say it'll be hard to actually audit this, and it will, and many developers may manage to get around it, but technically that's a breach of contract and they could be removed from the store for it, so I'm sure many won't risk it.
It wouldn’t surprise me if using a non-Apple payment system quickly became a very good way to figure out if you were about to get scammed by a random third party.
If it’s a company that I already know and trust, I might be willing (though Apple payments will still be more convenient).
Rando company? No way. Honestly this whole thing is probably going to prove their point. Even if they don’t exactly deserve the win.
https://twitter.com/dhh/status/1747406430054097099
It's beyond a joke. Between that and the payment processing fees, you're no better off. In fact, you get all of the same costs but none of the benefits of Apple's app store native payment infrastructure.
They're indeed making quite a joke out of antitrust at this point.
Everything was different though, you'd be paying for your OS upgrades too which doesn't happen on iOS. I agree 30% is crazy, but the market on iOS they're enabling has to get paid for somehow. That source of revenue was different for Microsoft in the 80s/90s but it still existed.
Which conveniently ignores the fact that you can buy software for digital download on the Internet for significantly lower overhead.
But they keep arguing it.
But you are looking at that through the lens of an end user.
As a developer, Apple's total acquisition cost i.e. 15/30% is far less than what it costs me to acquire customers through other channels e.g. Paid Ads, Referral etc.
I'd say the key difference there is that Microsoft didn't own all those retail stores.
Visual Studio wasn't free, but it also wasn't required. There are a wide variety of ways to develop software for Microsoft OSes.
How about paying for it with the massive profit they make selling the devices?
As far as I can tell, the only reason Apple’s doing the whole rent-seeking App Store business is “because they can.” Upside is all that money, downside is the developers kinda hate you.
Apple has 50%. Courts have already ruled they’re not a monopoly. Epic asked the Supreme Court to look at that again and they specifically decided not to and to leave the decision in place.
That’s why Apple can do what they’re (now, post order) doing legally and Microsoft couldn’t.
Making matters worse the Google Play Store is completely optional you’ve been able to side load for years. To the degree Google prevented that they just got kicked in the teeth for it.
So you’re going to have to argue that the combination of the Apple App Store, plus Google, plus Samsung, plus everything else all work together to screw over users.
Good luck.
That’s impossible by definition, a literal contradiction in terms.
And there is nothing preventing other companies e.g. Samsung making their own store.
Setting the price the same as your competitors is not price fixing.
That's deceptive language that undermines your argument.
A monopoly is a market with the "absence of competition", creating a situation where a specific person or enterprise is the only supplier of a particular thing.
If you said "duopoly" your argument would be more easily entertained or if you said "cartel". However, neither of these two characterizations stand up to scrutiny either.
Having locked in the richest consumers of the world, they get to say what goes and what doesn't, worldly courts and laws be damned.
It's both hilarious and gruesome at the same time, because we're supposed to be equal under consumer laws or whatever, but there you go!
Most of the modern digital consumer economy is based on products and services which are device-agnostic. If I’m using Spotify or Netflix or something they are service providers and the iPhone/ipad is just a client device. Apple should have no marginal returns (a cut) on money that should go to artists, actors, developers. They’ve already charged massively for both their physical products and their services.
Antitrust law is a joke. This has always been glaringly obvious since Jobs first came up with this shit. The fact that it still ain’t fixed is a travesty, not just for tech nerds, but it impedes the digital economy at large.
The greediest thing of it all is that they’re actually providing a service people would pay premium for - in-app purchases and their “all subscriptions in one place” without dark pattern harassment is very nice for consumers. They have a legit product worth a ton yet they still refuse to compete fairly. Anti-market capitalism..
Someone unironically complained yesterday that developers who don't like paying the 30% fee probably don't like paying their taxes, and I made the exact same argument that Apple was acting like a sovereign state [0]. And now Apple is doubling down by announcing that they'll be performing financial audits just like the Internal Revenue Service if you include a link to purchase content/services outside of the app store.
[0] https://news.ycombinator.com/item?id=39007657
> Apple’s commission will be 27% on proceeds you earn from sales (“transactions“) to the user for digital goods or services on your website after a link out (i.e., they tap “Continue” on the system disclosure sheet), provided that the sale was initiated within seven days and the digital goods or services can be used in an app.
As any F2P gamer knows, “whales” don’t just spend up front - they make microtransactions on a regular basis for months or years as new rewards become available. This is incredibly meaningful for game publishers who depend on long-term customer engagement.
I’m not sure why the audit requirement is getting called out. That seems pretty standard for this type of revenue sharing agreement to me.
They might just get away with something as crass in a vacuum, but given that the DMA will go into effect very soon, there will be a point of reference in a similar economy, and I don't think it'll be pretty for Apple.
US regulators (federal or state; I could see something equivalent to GDPR and CCPA) will be taking a very close look.
Off the top of my head...
- Bandwidth
- Running the App Store for users
- Marketing the App Store
- App review
- Security efforts to keep malware off the store
- Making App Store optimisation tools for developers
There's a lot of moving parts to this. You could argue that none of this is necessary if you sideload, but distribution is worth a lot in general to businesses, and I think it's clear that the App Store is a good distribution channel in many ways – easy to use for sellers (vs via traditional publishers, or physical retail), and easy to use for buyers.
Besides that, that list is very bundled. What if I e.g. want the convenient subscription payment processing, but want to (or need to) bring my own CDN for most content? What if I want their marketing and am willing to pay for it, but prefer my own payment processing?
Allowing other app stores would be the big win in competition here, properly forcing Apple to win on value proposition. The DMA could force this, but I'm not certain about the details.
It's an arguably quite sloppy illusion of competition/choice.
The advantage of mandating alternative distribution channels (i.e. sideloading or alternative app stores, both with their own payments infrastructure) would be that it wouldn't be up to a regulator to figure that out – the market could decide.
From my own experience, the app store brings negative value to both the users and the developers in many cases. It's most often seen not as the godsend like Apple portrays it, but as a stupid obstacle course that you need to clear every time you publish a new app or an update to an existing one, and sometimes even when you don't.
> distribution is worth a lot in general to businesses
No, digital distribution is worth so little it rounds to $0.
> App Store is a good distribution channel in many ways
It's the only distribution channel allowed so of course it's the "best" there is no competition allowed.
I get that there's no competition on iOS, but I was comparing to other ecosystems and mechanisms.
> So basically nothing that companies couldn't do themselves if Apple didn't explicitly block it. You pay 27% for fuck all.
No, you pay 27% for those services I mentioned. Those things aren't free if developers do them themselves. Developers may prefer to do some themselves because they think they can do them for cheaper, and in this case payments have been opened up so that there can be competition there – the DMA in the EU will do similar and I look forward to it.
You may disagree with the price (and I personally feel it's high), but these things cost real amounts of money to do. Not just this, but free app developers would also need to pay all these costs despite potentially having no revenue directly attributable to the app.
With limited exceptions, platform vendors (Microsoft, IBM, Sun/Oracle, etc) are generally not in the business of paywalling their development documentation, tools, and SDKs, otherwise it makes their platform far less attactive to third-party developers that they absolutely need in order to.
...and ever and never-mind that Apple's documentation is sub-par[1], even with the billions of dollars they're raking in. It boggles the mind because nothing is stopping Apple from hiring the people it needs to ensure decent documentation and DX, which can be paid-for directly from the $99/yr developer membership fee.
[1]: https://news.ycombinator.com/item?id=25046691
...so with that context in-mind, we don't benefit from - nor really need at all, most of those services you're referring to;
> Bandwidth
We're a small B2B SaaS with a userbase sized under 100,000 users and our old app bundle was around ~20MB and updated a handful of times per year, so even if 100% of our users used the iOS app with auto-updates then that's less than 2GB of data-transfer per published update - the cost of serving that is far less than a rounding-error on AWS/Azure.
> Running the App Store for users
I accept that.
> Marketing the App Store
No-one should be paying for Apple to market their own App Store - and as a B2B SaaS app, Apple would never promote us or do marketing for us.
> App review
I also accept this - but ostensibly this is what your $99/yr developer fee pays for.
> Security efforts to keep malware off the store
This is the same thing as App review; if we look more broadly, then it's better to compare this to Microsoft's Windows Defender which is free, and is funded independently of the Microsoft App Store.
> Making App Store optimisation tools for developers
Again, this is Apple's responsibility to pay for, not ours - and even-then consider that efficient update/patch distribution systems have been around for decades so it's hardly cutting-edge development (e.g. those ~KB-sized binary diff patches for CD-installed games in the late-1990s when we were on dial-up, like EA had for SimCity 3000 or C&C Red Alert 2)
For a B2B SaaS client app for BYOD users the iOS App Store is perfectly fine as a distribution system, and morally I'm fine with paying Apple some kind of fee for the benefits of their distribution system, but Apple has no legitimate claim to any percentage of the subscription fees we get from our users - so what this means is that we can make our app available for free to our users (which is fine, honestly) but (as per my understanding of the rules) we cannot offer any kind of account-management or billing-management for their SaaS subscriptions from within the app which isn't ideal.
I think Apple's main mistake here was deciding that having a single set of rules and fee-schedules/commission/etc for everyone, because the revenue models for exploitative mobile games (especially their gold/gems IAPs) differs massively from my company's unimaginatively dry B2B SaaS client.
On the other hand, non-equal fees ironically seem to be exactly what's made US courts decide in favor of Apple but against Google in two superficially quite similar cases regarding app store fees:
https://www.theverge.com/23994174/epic-google-trial-jury-ver...
I think the main mistake isn't the fixed percentage fee, but rather holding on to the golden goose that is an app store monopoly for too long.
Google has been providing sideloading since day one for example, and except for a few high-profile exceptions, people do genuinely seem to prefer the platform's native app store.
Apple always aims for total control and authority over everything: Their supply chain, the apps running on their systems, the devices allowed to interface with them – and while that obsession with keeping it as *their own platform arguably is part of what makes their devices attractive, I think it won't keep working forever in this case.
Even if for some reason you believe that's not true, there's no way they need 27% of all purchase revenue on the store to fund that stuff. The numbers simply don't check out. 30% was an arbitrary cut and that's why they can easily drop it to 27% or (for small devs as of recently) 15%.
In the situations we're discussing, both the app developer and every customer have already given apple hundreds if not thousands of dollars worth of revenue. Out of that, Apple has a healthy margin.
Now we're talking about Apple sticking their fingers into developers' pockets for every single transaction even if Apple's participation in that transaction is limited to updating a couple database rows to indicate that Customer XXXXX bought DLC Package YYYY in App ZZZZZ. There is simply no way that is worth 30%. They're not doing that much work.
In the EU has the 30% (or now 27%) been found illegal? I know they’re being forced to allow other app stores or side loading or something. But what about the fee?
For obvious reasons, the US government and justice system is probably not interested in being the beta tester for such a regulation – they have relatively little to gain and much to lose. Even "green bubbles" seem to be a much bigger point of contention in US public discourse than sideloading/the 30% tax.
But if the DMA it ends up working well well and consumers like it, and app store customers manage to sell that fact to the US voting population, the wind could change for Apple too.
I don’t think that really matters at all. No one (in the legislative branches) cares enough to pass something about this. Is basically impossible to get things past anyway recently, even far more important things than this.
Even an ineffective regulation that neither hurts nor harms consumers but ends up hurting Apple would probably be seen very negatively.
> Is basically impossible to get things past anyway recently, even far more important things than this.
Very true, and another point in favor of inertia. The only thing that could possibly break that is seeing a similar regulation be a slam dunk in a comparable market, but even then it's a big if, I agree.
I just don’t see us leading (or going in parallel) due to lack of interest/will.
The regulatory rules passed in the DMA are written to allow action without the need to go through the whole legislative process.
I predict it will come to that. Apple is gonna fight this tooth and nail to the very end. And unless they change their attitude and business practices, Europe has very little too lose by piling more and more rules on them.
The 27% is not really a problem if there were a competitive market. If one emerges we'll see if not...see above.
I’m curious to see what happens in the EU. Apple could do a couple of things to make their life easy but I know they’re gonna go down kicking and screaming and make things worse for themselves. It’s what they always do.
<< The DMA covers eight different sectors, which it refers to as Core Platforms Services (CPS). Due to the presence of gatekeepers who, to a certain degree, affect the market contestability, the CPS are considered problematic by the European Commission:
online search engines (e.g. Google Search);
online intermediation services (e.g. Google Play Store, Apple's App Store);
social networks (e.g. Facebook);
video sharing platforms (e.g. YouTube);
communication platforms (e.g. WhatsApp, Gmail);
advertising services (e.g. Google Ads);
operating systems (e.g. Android, iOS);
cloud services (e.g. Amazon Web Services).[4] >>
They are taking 27%, between that and processing fees you might as well use In App Purchases.
"Apple’s commission will be 27% on proceeds you earn from sales (“transactions“) to the user for digital goods or services on your website after a link out (i.e., they tap “Continue” on the system disclosure sheet), provided that the sale was initiated within seven days and the digital goods or services can be used in an app. This includes (a) any applicable taxes and (b) any adjustments for refunds, reversals and chargebacks. For auto-renewing subscriptions, (i) a sale initiated, including with a free trial or offer, within seven days after a link out is a transaction; and (ii) each subsequent auto-renewal after the subscription is initiated is also a transaction.] If you’re a participant in the Small Business Program, or if the transaction is an auto-renewal in the second year or later of an auto-renewing subscription, the commission will be 12%. These commission rates apply to all amounts paid by each user net of transaction taxes charged by you. You will be responsible for the collection and remittance of any applicable taxes for sales processed by a third-party payment provider. If you adopt this entitlement, you will be required to provide transaction reports within 15 calendar days following the end of each calendar month. Even if there were no transactions, you’re required to provide a report stating that is the case. If the cadence changes, we will update this page. To learn about the details that will need to be included in the report, view example reports. In the future, if Apple develops an API to facilitate reporting, you will be required to adopt such API within 30 days with an update of your app and follow the timing and requirements provided."
Depending on the payment method used, they might just make a profit on this (e.g. some cards charge more than 3% of interchange alone, and there's other fees on top).
But court has also found their required to do this. So if there are roadblocks are onerous you know someone’s going to go running to the court to try and get that fixed.
They could end up in big trouble if they try and fight it too hard. But they’re also not gonna roll over.
Expect the same exact thing with the DMA changes in the EU.
[0] https://twitter.com/TimSweeneyEpic/status/174728054136210228...
This was announced for dating apps in the Netherlands in Feb 2022, I think Korea also has had similar changes. https://www.computerworld.com/article/3649111/apple-begins-t...
As GP mentioned it has been in effect for a while in Holland and maybe Korea or a few other places for at least certain kinds of apps due to local laws.
Interesting note: this only applies to the US. I know the EU is forcing changes as well, but those are EU only.
So South America, Asia, Australia, Africa, Canada, Mexico, and others haven’t changed one bit and likely still require 30%.
In this scenario, is there something specific that we should know/understand about (a) dating apps or (b) the Netherlands?
Add to that that the link can only be displayed on a single page (not a modal or popup) and cannot be part of a purchase flow (where else would it go?). Certainly a huge slap in the face to all developers and the court's intent.
They also say that using parameters in the URL is a privacy concern, when the real reason is they don't want you to use some kind of one-time-link to log the user in. They want the user to have to log in again, making it as painful (and least likely to convert) as possible.
For small players a 3% savings isn't worth the administrative overhead of paying apple separately.
Apple is begging for another lawsuit over this.
Apple doesn’t see their cut as “payment processing and hosting”. They see it as the cost of selling for their platform.
In other words, a developer can have a Facebook ad or similar go directly to the checkout page and buy the app there, bypassing the app store commission for traffic the developer is bringing to the app store themselves. Feel free to correct me if I'm wrong on this.
This being the case, any recommendations for carts / processing services / etc that would be ideally positioned for this kind of use are MASSIVELY welcome!!!
https://twitter.com/timsweeneyepic/status/174740814726057173...
If we’re talking about the details of the implementation, maybe.
If it’s about the commission that still needs to be paid, then no. That’s directly mentioned in the original ruling by the district court, a commission is due regardless.
Ironically, this is something that is bothering the appellate court as well if you read between the lines of their judgment[0].
They gently criticize the district court for both saying that developers should be able to link and sell outside the app while simultaneously saying that it’s undesirable for Apple to audit developers because it’s too cumbersome.
But the appellate court isn’t meant for do overs, just for when courts have erred in a significant way, so they only gently lament this, instead of doing something about it.
0: https://cdn.ca9.uscourts.gov/datastore/opinions/2023/04/24/2...
You agree to keep accurate books and records related to your development, manufacture, Distribution, and sale of Royalty Products and related revenue. Epic may conduct reasonable audits of those books and records. Audits will be conducted during business hours on reasonable prior notice to you. Epic will bear the costs of audits unless the results show a shortfall in payments in excess of 5% during the period audited, in which case you will be responsible for the cost of the audit.
> Apple is already pretty clear in its developer agreement [0] that the 30% commission is for "its services as Your agent and/or commissionaire" (Schedule 2 3.4), not for its services as a payment processor. They are contractually allowed to take the 30% fee out of payments collected, but merely using a different payment processor doesn't remove the obligation to pay them for their other "services as Your agent and/or commissionaire".
0: https://developer.apple.com/support/terms/apple-developer-pr...
In addition, from the original ruling:
> Yvonne-Gonzalez was skeptical of the 30% fee during the trial, and in the ruling she was suspicious about Apple's justification of the commission, writing that "the 30% is not tied to anything in particular and can be changed," but did not order Apple to do so.
Mind you, you can be blocked from doing needed Apple dev stuff (eg sign binaries, etc) until you've manually logged into your Apple account and clicked on the "I accept" button whenever they change terms.
This happened to us (sqlitebrowser.org) in recent weeks, as our CI just stopped working one day.
It turns out there was a new developer agreement that needed signing, and until I'd logged in and done that then Apples servers would no longer sign binaries.
There's literally no choice but to sign the things - regardless of terms - if you want your users to have software that runs.
This gets to be a real nightmare in large organizations with multiple Apple Dev Portal admins, some of which may not even be authorized to sign legal documents on behalf of the company.
I suspect the EU will at some point, they have haven't already, make terms that must be accepted to continue void.
https://europa.eu/youreurope/citizens/consumers/unfair-treat...
You know given they charge exactly the same way for Unreal Engine.
Apple isn't charging for use of the iOS platform SDKs; the developer agreement is much more vague and weasely about what they're charging for, being the developer's "agent and/or commisionaire".
Per-sale licensing for a copyrighted (or patented) work is pretty normal and done in many industries. Apple's agreement doesn't specify any fees for licensing at all.
I.e. Epic's goal here isn't about whether Apple charges 99% or 1% rather it's about allowing other payment methods (theirs in their case of course) to compete with equal footing regardless what Apple wants to charge to do it through them instead.
And the fact the developer is to hide the fee and not list it on the receipt (subscription: $10, Apple tax: $3)
And the fact you cannot charge less for the same service if you sold it outside the platform (as you'd like to do as you didn't need to collect the Apple tax).
Netflix has an app, Netflix “is not” an app. Google Chrome, Airbnb, Epic, anyone who has spent marketing bucks promoting their service and providing a supporting app, was rather acting as a marketing agent for Apple than the opposite.
Apple’s new stance has no merit. We all understand it’s fair to participate in the funding of the Appstore, but it is a very bad defense.
I thought that was expressly permitted - just that Apple Tax still must be collected:
> The link can mention the specific price of content on a website, or that content is discounted on the website from the App Store price. Comparisons are allowed.
In that manner, this ensures you cannot compete with Apple IAP on price, and is hence still wholly anticompetitive.
https://help.netflix.com/en/node/25097/
They’re a so called “reader” app which can send you to an external site to subscribe.
https://developer.apple.com/support/reader-apps/
Other streaming services fall into the same category.
If I recall, and from what I’m now able to find, Netflix didn’t lower their prices when they did that move. And remember they have added ads, are cracking down on password sharing, and prices keep increasing.
So while Apple’s cut is high, let’s not fall into the trap of believing that other big companies are somehow fairer and would totally pass the savings onto us. The overwhelming majority, if suddenly exempt from paying Apple’s cut, would keep charging the same thing and pocket the extra revenue.
Epic's goal is to pay lower platform fees to Apple and Google, presumably lower than the (30%?) platform fees they pay to Nintendo.
(Not defending anything here)
Anti-price-gauging laws have already been ruled as constitutional, so there is case law for "You're charging too much"
The 30% App Store tax does suck but I’ve never understood why it’s singled out. My best guess is that people hate platforms because it’s a 3-way transaction, which makes everything harder, including price negotiation. And also the service isn’t particularly unique, unlike the house, or a status symbol, unlike the Gucci handbag.
Ironically, if Apple made App Store publication more expensive but invite-only, like a high end Bugatti sports car, I don’t think it would’ve ended up in court.
https://game8.co/articles/latest/epic-believes-nintendo-sony...
The argument that the consoles are subsidizing the hardware is just an excuse which has the causation reversed. They're not charging 30% because they have to subsidize the hardware, they're subsidizing the hardware in furtherance of their scheme to charge 30%. Without it they would stop subsidizing the hardware, but so what? People would pay less for games and more for hardware.
You might even pay less for hardware, because there would be no more reason to restrict games to a particular console and then you would only need one to play all the games, and Sony/Nintendo/MS would compete like (or be replaced by) Dell/HP/Lenovo.
Price gauging has a very particular meaning; it isn't simply a subjective "you're charging too much".
It is the practice of significantly increasing the prices of goods, services, or commodities during a time of crisis or high demand. This can happen when there is a sudden shortage of a product, like during a natural disaster, or when there is a surge in demand, like for popular concert tickets.
Characteristics of price gauging include:
- unconscionable prices
- taking advantage of a crisis
- limited supply or high demand
In the United States price gouging is illegal after a state of emergency has been declared.
You can read more here: https://oag.ca.gov/consumers/pricegougingduringdisasters
We really do live in clown world
> Apple is charging a commission on digital purchases initiated within seven days from link out, as described below. This will not capture all transactions that Apple has facilitated through the App Store, but is a reasonable means to account for the substantial value Apple provides developers, including in facilitating linked transactions.
> Apple’s commission will be 27% on proceeds you earn from sales (“transactions“) to the user for digital goods or services on your website after a link out (i.e., they tap “Continue” on the system disclosure sheet), provided that the sale was initiated within seven days and the digital goods or services can be used in an app.
So tl;dr: of that page is that Apple is saying "if you wanna link to your website, it can't be prominent (only a single text link with our language in our chosen placement) and we still get our commission."
> As discussed in the findings of facts, IAP is the method by which Apple collects its licensing fee from developers for the use of Apple’s intellectual property. Even in the absence of IAP, Apple could still charge a commission on developers. It would simply be more difficult for Apple to collect that commission.
> In such a hypothetical world, developers could potentially avoid the commission while benefitting from Apple's innovation and intellectual property free of charge. The Court presumes that in such circumstances that Apple may rely on imposing and utilizing a contractual right to audit developers annual accounting to ensure compliance with its commissions, among other methods. Of course, any alternatives to IAP (including the foregoing) would seemingly impose both increased monetary and time costs to both Apple and the developers.
https://casetext.com/case/epic-games-inc-v-apple-inc-2
They did back when they were part of the developer program. If they can make their case that it is bad faith compliance as part of their original case before the Court goes “c’ya, we’re done here”, they might have something, but Apple revoked Epic’s membership for violating their terms in the developer program worldwide and at the conclusion of this lawsuit, Apple has not been ordered to reinstate it. So Epic can’t really argue that they have or will have suffered a harm under these new terms since they’re still in a position where Apple isn’t doing business with them and their lawsuit under which they did have standing is basically at its conclusion.
Again, little surprises me in the legal system these days, but I have to think courts would be very skeptical of an argument where a potential defendant controls the gates that decide whether a potential plaintiff has standing.
They did so in Cameron vs Apple and Google … and settled I believe !
I'm repeating the words of another commenter, but most app devs aren't competing against Apple but other devs. They aren't billion dollar businesses that stand to benefit by trying to get a lower rev share.
But I do agree that most developers probably wouldn't be interested. They don't want to stand up their own payment processor, or don't care to do integrations with a bunch of third parties, and tolerate the fees to use Apple's payments platform. And for many of these developers, their entire business is built on their relationship with Apple. Getting their developer accounts terminated would mean shutting down entirely.
- Epic pushed an update to Fortnite at some point to the App Store that would allow them to issue an update from the server side to enable a flag to offer Epic’s own payment processor where you could buy in-game currency from them instead of IAP. They then issued a server update toggling this flag and began advertising it to Fortnite players immediately.
- Apple removed Fortnite from the App Store for violating their policies.
- Epic files suit almost immediately and begins a PR and advertising blitz they had clearly prepped far in advance. In other words, picked a fight. Epic has standing for this suit because they have suffered a harm (Apple removed their app).
- After a grace period in which Apple explicitly laid out to Epic that they were risking their developer account, offered them time to get back into compliance and resubmit Fortnite to the App Store, they terminated Epic’s developer program account. This ended Apple’s business relationship with Epic.
- That lawsuit has now concluded. Apple took it on the cheek for the anti-steering provisions and has come up with a plan to comply which they are now implementing, all appeals have been exhausted, and Apple and Epic no longer have a business relationship.
(I’m missing some details, and the language is vague because I honestly can’t remember the full timeline of events and would rather be vague than wrong here, but that should the gist of it.)
Put another way, when you choose to be in a business relationship with Apple, Apple is also agreeing to be in a business relationship with you. Apple has not chosen to re-enter a business relationship with Epic, and has rejected Epic’s offers to do business with them. It’s a simple as that. So how can Epic now argue that they have standing for harm caused by Apple’s plan for compliance that affect the way they do business with developers in their developer program when they are no longer in Apple’s developer program?
Once the judge decides they’re done and there’s no more avenues of appeal or additional grounds for appeal, they’ll have no more standing than some random guy off the street who has never signed a single agreement with Apple, not even an iTunes ToS agreement. From what I gather, the Judge wants to be done here too, Epic has had their days in court with the full due process of law but there are other cases to be heard and Epic doesn’t get to hold up the courts any longer because they didn’t get the W they were looking for.
Somebody else, if they think they can do it, can try to have a go at Apple next, but even with the one L they took on anti-steering, I think without some new laws being written their entire business model just got a lot more legally resilient.
Now why is standing important? Put simply, in theory, you can basically file suit against anyone for anything, but if you didn’t actually suffer a harm, and you can’t convince a Judge in the jurisdiction in which you allegedly suffered the harm that you did, then they’re going to throw out your case. It’s a waste of the courts time if there’s no case to be made, you filed suit in the wrong jurisdiction, or you filed suit under the wrong provisions of the law under which you are arguing you suffered a harm.
Apple's public comments to the point have been that Epic is free to resume publishing under the developer program if they abide by the developer agreement, and Epic's CEO has stated they have no intention to do so.
Agreeing to the program terms would seem to put them in a position where they can either argue they have standing or that they have been caused harm, but not both.
> Agreeing to the program terms would seem to put them in a position where they can either argue they have standing or that they have been caused harm, but not both.
Agreed.
Apple gives much more consistent terms.
The speculation is that the 15%-after-first-year subscription change was something they had actually negotiated with Netflix in an attempt to keep in-app subscriptions, which they then rolled out to everyone rather than keep as a Netflix-only deal.
I'm sure Apple is not sad Epic is off their platform, because they are a bad partner. But they would still let them back under the same terms as everyone else, if they agreed to actually abide them this time.
The issue is the last time I recall them saying that was before they terminated Epic’s developer accounts. That was a couple of years ago at this point.
So my question was not about any of that, none of it is new to me, my question was the following: how recently, to your knowledge, did Apple say they would let Epic back in the program? I tried searching around but I didn’t turn up anything recent, or anything from after 2021, but I don’t think Apple’s statements from before they terminated the relationship are applicable at this time, so I was hoping you could provide some additional information that I am lacking.
Apple is likely asking for 27% cut for non-IAP w/Apple because they are saving 3% by not processing credit cards directly. They don't need devs complaining it's MORE expensive to use their own payment processor.
Maybe they want to be the competing payment processor for third party developers who are in Apple's developer program, but don't have the resources to litigate against Apple themselves.
And doesn't Epic Games Store already do payment processing for third party game developers? We know they want to offer the whole store on iOS but if that isn't yet possible then you do what you can.
Yes, but they don’t currently offer it for iPhone apps and games. Just to reiterate, I think this is the best argument for standing I’ve seen, but it’s not an easy sell and if Epic does get into this business, it leaves them in a position of basically trying to undercut the 3 percentage points that Apple is valuing their payment processor at.
> Maybe the argument would be that Apple is actually charging more than 3% for payment processing and is continuing to charge the difference even when you use a third party payment processor, to discourage anyone from doing so. Which could provide a new chance to raise the issue of their high fees, if this is the first time Apple has tried to declare a split.
Judges don’t usually want to get into the business of setting prices for private businesses. Judge Yvonne Gonzalez Rogers has already determined that Apple has a right to collect their commission, and Apple has already had to define the value of what the payment processing portion of what that is in the Netherlands. ~3% is also generally what you can expect to pay a payment processor to begin with which is why it never, even from the beginning of the App Store, for people to interpret “30%” as Apple’s payment processing fee because even back then, that’s not what any reasonable payment processor charged. If needed, Apple could probably produce documentation showing what they pay a processor.
Isn't the whole premise that they want to be in that market and Apple precludes it?
> ~3% is also generally what you can expect to pay a payment processor to begin with
But that's kind of the point. If Apple is charging more than that for payment processing but then only refunding the ordinary amount when you don't use their service, it precludes anyone else from competing with them on price because the customer is still paying Apple the remainder of Apple's payment processing fee which isn't refunded.
The way to evaluate this isn't to look at what payment processors charge, it's to look at what the rest of what Apple ostensibly charges for would cost in a competitive market.
At which point the first thing you'd have to ask is, why is this still a percent of revenue? It is for payment processors because their fee has to account for fraud risk, which scales with the amount of the payment being processed.
Fees as a percent of revenue are quite unusual for providing any kind of hosting services or marketing or development tools etc. Even sales commissions are a percent of the sales attributable to the salesperson, not a percent of all sales including the ones via other sales channels.
Charging a percent of revenue is a strong indication of a monopoly rent because it's so hard for anyone but a monopolist to get away with it. Even when Visa does it, the fraud risk is more of a fig leaf and the truth is a big chunk of that amount is going to fund credit card rewards programs intended to get people to prefer credit cards to other payment alternatives and the credit card networks only get away with charging it because of the weak competition.
And in any event the balance of what Apple provides is typically extremely inexpensive. Development tools are widely available for free, search engines don't charge to be included in search results (and the fee can't be for search advertising when it's paid by everyone), the per-download hosting cost for an average-sized app on Amazon S3 rounds to zero cents. What are they doing that could explain 27% if it isn't a monopoly rent? Why is it 12% for smaller entities, when economies of scale go the other way?
> Judges don’t usually want to get into the business of setting prices for private businesses.
Which is why the better solution is to prevent this kind of tying of products and services together, so the prices can be set individually by the market instead of trying to disambiguate the price of each service when they're all tied together.
It's the weakest objection you can have, and typically would only be sufficient to get relief in very, very specific circumstances where the unfairness could be proven (as intended). But this case involves broad policies for millions of developers, and it's perfectly compliant with permitting other payment processors.
So: there's almost no chance it would be "shot down" on those grounds.
They're clearly making Apple's in-app purchases the preferential choice by prohibiting developers from using anything but a single plain text link, and scaring users with strongly worded warnings.
IIUC, the ruling said Apple has to allow devs to link to an alternative payment processor (i.e. Netflix can now link to netflix.com instead of the absurd rigmarole they had to endure before). Apple now allows devs to do this, with certain requirements (namely, a 27% commission). Since the court said Apple is allowed to collect a commission, those requirements don't seem to be (to this non-lawyer) illegal.
Are the strongly worded warnings untrue?
Absolutely no one should be surprised by the new policy. Every podcast I listened that discussed the matter when the judge handed down the initial verdict predicted this outcome.
The main thing that feels icky to me is the hurdles to getting approved to link to alternative payment methods, but even if those are walked back that doesn't solve the main issue, which is that alternative payment providers were never a sensible solution to Apple's tax.
Apple has always argued that the commission is for the App Store, not for payment processing, and it is only collected through their payment processor as a matter of convenience. The policy announced here is essentially the same that they announced two years ago in the Netherlands in response to a similar ruling [0]. I'm surprised that anyone here is surprised that they're doing the same thing in the US.
[0] https://news.ycombinator.com/item?id=30204604
How are they even going to attempt to enforce compliance. Is every store required to integrate with their payments API?
If they’re taking payments from the platform and it does turn out to be a scam, now their hands are dirty as well.
This is worse from the original restrictions _specifically_ because the original restrictions were chosen to simplify from this sort of scenario.
If Apple says all app purchases and purchases of digital goods/services within the app are subject to the 15/30%, and those payments are always made through Apple, then Apple can check for non-compliance with the contract terms up-front (via App Store review) and then there are no separate books to audit, there is no commingling of revenue from in-app purchases vs independent web purchases or purchases made on other platforms, and so on. No need to audit the company's books, because they are using Apple's books.
It is hard to take Apple to task for charging too much, because the 30% ceiling and who pays it has effectively been the same since day 1 of the App Store. They have only created special cases to reduce that percentage (small business program, multi-year subscriptions).
Regulators can say that you can't block other companies from the "iPhone in-app payment for digital goods" market without being anti-competitive, but it is much more onerous to force a company to continue to provide a set of services (maintaining developer tools and SDKs, reviewing and signing binaries, providing backward compatibility in new OS versions) but for a fee schedule determined by regulators.
> Taking a commission from a company that’s already paying for payment processing can’t possibly be seen as reasonable.
Why not?
There's a decades-running assumption by some that Apple was a ridiculously expensive payment processor, only existing because they gave you no other choice than to use them for certain things (and outright forbade you from using them for others).
But Apple provides other services and access to developers per a financial agreement, and was doing payment processing to meter the revenue split.
The regulator argument is that Apple is blocking other companies from taking in-app revenue for digital services. Apple has now split that out in a few markets for companies willing to take on such complexity.
IMHO the only apps I think actually have benefited from the split are dating apps in the Netherlands - because quite frankly the way many dating services charge people is user hostile and/or discriminatory.
A rather obvious thing they could do is just prohibit the fee from being a percent of the developer's revenue. If Apple wants to charge everyone $1000 for a copy of Xcode and the iOS SDK, go to town. But then, people should be able to make competing developer tools and SDKs for iOS, and have competing stores where someone other than Apple is doing the reviews etc.
The main issue isn't even what they're charging, it's that they constrain you from using the alternatives that would induce them to charge less via competitive pressure.
Per the judge's own words, Apple is allowed access to the company's financials and other information that would allow them to audit developers' use of third-party payment systems.
> As discussed in the findings of facts, IAP is the method by which Apple collects its licensing fee from developers for the use of Apple’s intellectual property. Even in the absence of IAP, Apple could still charge a commission on developers. It would simply be more difficult for Apple to collect that commission.
> In such a hypothetical world, developers could potentially avoid the commission while benefitting from Apple's innovation and intellectual property free of charge. The Court presumes that in such circumstances that Apple may rely on imposing and utilizing a contractual right to audit developers annual accounting to ensure compliance with its commissions, among other methods. Of course, any alternatives to IAP (including the foregoing) would seemingly impose both increased monetary and time costs to both Apple and the developers.
https://casetext.com/case/epic-games-inc-v-apple-inc-2
The court didn't rule against the Apple Tax, just on the monopoly for payment provider. I understand that many people misunderstand this point, but that does not change it.
By trying to make it apply to apps purchased on other stores, they are essentially saying they have a right to add a commission fee to any transaction involving Apps that happens on an Apple Device, which seems like an overreach to me.
This whole lawsuit is because Epic wanted to avoid the Apple Tax by processing in-game purchases via their own payment provider, bypassing Apple App Store or Apple Pay or whatever other thing Apple forces everyone to use on iOS.
So Epic is now allowed to use their own payment processer for in-game purchases, but Apple is saying that they will still have to pay the Apple Tax for those purchases.
In this case the "store" is not an app store but an in-game store, sure.
Have I got that right so far?
That may be, but that's not what the court ruled. The court ruled in favor of Epic on only one count of ten - specifically that Apple must allow other payment processors.
As long as the app was originally installed via the Apple App Store, it's still subject to the Apple Tax.
Hopefully they all figure something out eventually to allow Kindle purchases from the app.
I don't see how Apple would prohibit me from visiting a website, and they've allowed use of content/subscriptions purchased elsewhere in iOS apps for a while now.
What has not been allowed (at least until today) is to directly link to that external website.
If you attempt to purchase a kindle book from within the kindle app, you will not be able to. Nor will there be any messaging explaining how to make a purchase (because apple does not allow such messaging). You’ll just be mysteriously confused about why you can’t buy a book.
You can use your credits from your subscription, but you cannot pay for a new audiobook in the app.
It’s a relatively recent feature (past year), but it’s possible.
No idea why the price through the app was better than the price on the website. Maybe some kind of promotion? Weird.
I'm not surprised, since you can often buy a Kindle + Audible book for cheaper than buying the Audible book alone.
If you look at the Audible book (such as Wool https://www.audible.com/pd/Wool-Audiobook/B0BKR3Y6SP) the price is often higher than if you look at the Kindle book price, and adding the Audible narration (https://www.amazon.com/Wool-Hugh-Howey-ebook/dp/B088SY4GSD).
In the Wool example, the Audible book is $31.64, but the Kindle book with the audible add-on is $9.48 ($1.99 + $7.49). Even if the Kindle book was selling for "list price", it would still be cheaper at $27.48.
So, I'm guessing there's just a lot less margin headroom to eat a 30% cut on Kindle prices, but plenty to eat that on Audible's prices.
I kind of figured this already when there's no way to filter apps by "doesn't have in-app purchases".
I feel more taken advantage of by the original maker than I do Apple.
However, my belief is the entire App Store should be subject to the same rules as Apple Arcade. It would be a far healthier app ecosystem, far less predatory
For the privilege of paying 2.9% more, my users get to see a scary privacy message and when I bill the customer a year later for a subscription, there's a 20-30% chance that their credit card will have expired.
If this isn't a monopoly abusing its dominate market position, then what is?
edit: here's one of the 'victims': https://news.ycombinator.com/item?id=39022303
This is why unions are a thing. They create collective bargaining power. If all of the app store vendors would unite they'd have a formidable position vis-a-vis Apple, Google etc. And there is no reason why app store developers could not form such a collective to increase their bargaining power.
You must have seen it mentioned on HN before: don't build your house in someone else's garden or something to that effect, in other words: if you make all of your income in someone else's eco system you are giving them a lot of power over your business. That's a bad move, but if you have to do it make sure you have a lot of friends, just in case.
> And there is no reason why app store developers could not form such a collective to increase their bargaining power.
This is also where you lose me entirely. You’re basically talking about unionizing independent businesses. Just call it a cartel. That’s the word you’re looking for.
No, a cartel is something different entirely. A cartel is a bunch of businesses that set the price for a market, not a collective that serves to increase the bargaining position of individual entities that are too weak to do so on their own power. Cartels are all about price fixing while keeping the competition out.
[1]: through some silly chicanery requiring an application process, and only if your business earns $1M or less a year. Apple may be within their rights but damn do they make themselves look bad when it comes to this shit.
No, the aim is not to 'fix price'. A cartel sells a resource at an artificially inflated price to a group of consumers who have no idea that this is happening (unless the cartel owners happen to advertise the fact). Typically cartels are illegal.
> The aim is to fix a price, and the price you are trying to set is the price at which another business buys units of your software or services for resell.
No, it is not about setting a price. It is about setting a (reasonable) cap on a margin on your own price. That's an entirely different thing.
> That’s the price, and their right to charge it has been upheld, but your proposal is to band together the small, medium and large businesses that virtually fill the App Store and have them War Doctor around going “No more!” or dictate a lower price. That’s collusion, that’s price fixing, that’s a cartel.
No, that's much closer to a union than a cartel.
Okay, so what if Apple decided a reasonable price for doing business with them was between 12% and 30% of the price you set per unit, and that you can take it or go into a different business writing software for other platforms instead, for which a non-exhaustive list in 2024 includes the following: Windows, Android, PlayStation, Xbox, Switch, Linux, servers, the Web, embedded systems, supercomputers, mainframes (no really), webOS televisions, and custom systems? Pretty soon, depending on how this DMA stuff shakes out and how Apple ends up complying, you might even be able to develop for iPhones on less onerous terms, but only in the EU, so add EU iPhones to the list above as a “maybe” after March 7th.
Some people might take that deal, and others might choose to do their work somewhere working on something else. How do you plan to deal with the businesses that are just going to take the deal? Like they have been, every single time they’ve voluntarily signed the developer agreement without a gun to their heads and invested more money into building on Apple’s platforms?
Also note that through their control of GitHub they could shut down 90%+ of of the FOSS movement out there with the click of a mouse.
I still disagree with the form of your rhetoric as I do see cartel as a more accurate description, but out of respect for the internal consistency of your argument, I’ll drop it. People can see the case you made and make up their own minds. :)
It could even be several groups, so long as they are pushing a similar agenda.
Your original comment used the term “abuser”, which refers to a very specific kind of crime that not only frequently does involve a victim’s acquiescence to their abuser, but that is often the ultimate purpose for the abuse. I understand what you’re trying to say, but I think it’s probably for the best to simply avoid using domestic violence to make such analogies altogether.
It not only risks being taken to be in poor taste, but I think it’s also unnecessary in this context. It’s not especially difficult to understand why Apple’s market position gives it the kind of outsized leverage to force other stakeholders into engaging with unfair, even illegal, practices that are frequently contrary to their own interests. In negotiations, and within free markets more broadly, there’s a level to which this kind of uneven power dynamic can be productive, but it’s very clearly gone too far here, and is rightly seen as suppressing competition, stifling innovation, and sabotaging the potential for entrepreneurs and small businesses to thrive.
It’s precisely the kind of thing that the federal government should be on top of, but until congress resumes its regularly mandated duties (it’s my understanding that the United States Congress has been starring in some sort of reality TV program for the last several years, and must continue until they have voted all but the last remaining legislator off of Joe Manchin’s houseboat) it’s probably a good idea to explore other options, like labor unions or maybe crowdfunded federal class action lawsuits.
Abuser has much wider connotations than just domestic violence and I'm not so focused on sex crimes/domestic crimes that I see the term as inexorably connected but for those that do feel free to substitute another term that indicates a power relationship between two parties in which one takes advantage of the other even if the other willingly entered into the relationship.
Note that class action suits are not powerful enough for this: they simply allow Apple to partition the world into many small fiefdoms each of which will have to fight individually for their rights. Much better to tackle this as all developers versus Apple, that way you stand a chance of making it stick.
Lmao, except, they literally do.
This is why leaving an abusive relationship is so fucking hard.
Android and iOS have an abusive relationship with developers.
But what I think would happen is that there would be enough hold-outs from such an effort that Apple would come out on top because the players in the eco -system are more in competition with each other than that they really mind Apple. They want to pay Apple less but they want to put their competition out of business even more...
Where you think of organising a rally or just an email campaign ?
[1] https://www.theverge.com/2023/5/19/23730302/apple-app-store-...
I just posited the idea here in NL at 2:30 in the morning and you, somewhere else entirely have already heard of it. That mechanism could be vastly improved upon but I think the principle is sound as your average cat meme has proven thousands of times by now.
If a developer union of sorts succeeds in negotiating down Apple's charge, there is absolutely 0 chance that this cost savings will make its way on the whole to consumers precisely because developers have already proven that customers are willing to take a higher price.
As an end customer I think it's a good thing if an indie developers get more money in the abstract. I don't think I care if it means that Netflix gets to keep more of their money instead of Apple.
I'm much more sympathetic toward lower fees for smaller companies. Once you are the size of Meta, Google, Apple, Amazon, Netflix, Spotify, etc. it's just jostling between multi-billion (trillion) companies and I'm not really concerned one way or the other, especially if these actions result in more annoying behavior that I have to deal with, like multiple app stores, increase in spam and ads and spying, and the dissolution of the power of features like Sign in with Apple that allow me to generate fake email addresses.
That's perfectly ok because that's not the intended effect, the intended effect is to stop Apple/Google from exacting a 30% toll on their platforms, not to improve consumer prices.
> I'm much more sympathetic toward lower fees for smaller companies.
This already exists.
Having another “store” doesn’t necessarily mean having to get apps elsewhere. E.g., the one platform app store has severely degraded my ability to enjoy audiobooks. I used to be able to buy books directly in Audible (on Android anyway). It was convenient and Audible offered daily deals. I’d get books on a whim and discover new authors that way. Once Audible had to start paying a 30% tax, that feature went away. Now I have to browse & purchase in a web browser, which is far less convenient.
Incidentally, both Apple and Google sell audiobooks. Presumably they aren’t paying a 30% tax themselves and can use that as a builtin price advantage. But, then I’m tied to that platform.
In this case, you'd be making an "in-app purchase" with your Amazon account. There's no new annoyance in payment management and there's no new store to browse. You just get a more convenient way to buy content.
You’re also not required to use an iPhone. Grab an Android phone with the features you want (multiple app stores) and you’re good to go!
Anyway.
The best store isn’t necessarily the best store for me, and apps (think TikTok, etc.) have more pull than an App Store does so what will happen is they will launch their product only on non-Apple app stores that have less strict requirements and review processes and people will go download from there. Customers will have to download multiple app stores, manage subscriptions in multiple places, have to manage user profiles and credit card information across multiple app stores, etc. It’s kind of like today with the competing streaming services. Not great.
While this presents a few problems, my chief concern is that it unwinds some of the great features that Apple essentially lobbied for on behalf of customers. Features such as Sign in with Apple, and other privacy oriented features.
With multiple app stores customers have no bargaining power or anyone bargaining on their behalf. It’s a marriage of corporate interests united against customers.
I’m struggling to see the benefit to customers. It seems like we’re trying to screw normal people so a few big companies like Meta can make an extra buck and grab up more of your data.
The situation isn't much better on Android. Yes, there are multiple stores, but since Google Play Services are locked up you effectively have to use the Play Store. Of course, there's more to consider than just the store and there are other reasons, some involving lock-in, to want to use an iPhone.
> While this presents a few problems, my chief concern is that it unwinds some of the great features that Apple essentially lobbied for on behalf of customers. Features such as Sign in with Apple, and other privacy oriented features.
Using Android as an example, that just didn't happen. Granted, part of that is the hoops Google has you jump through to sideload anything. Samsung and Amazon both have stores and outside of Amazon Fire devices, their adoption is quite minimal. So, I don't think this future where everyone abandons the Apple App Store is apt to happen. Having competition in the space should spur Apple to deliver more. And as a consumer I have the option to sideload apps on my computing device if I'd like.
> With multiple app stores customers have no bargaining power or anyone bargaining on their behalf. It’s a marriage of corporate interests united against customers.
I don't know what power I really have with Apple's App Store. Some parts are nice. Some aren't. I have no ability to influence that. I can't "let the market speak" without using a completely different device.
Moreover, other app stores need to have an actual proposition to get adopted. Assuming companies still want to make money, they'll likely still sell apps through the Apple App Store.
> I’m struggling to see the benefit to customers. It seems like we’re trying to screw normal people so a few big companies like Meta can make an extra buck and grab up more of your data.
I don't care at all about helping Meta make more money. I think you'll find that's true for almost everyone. I'm not looking to screw myself or anyone else for that matter. I do care about the grabbing more of your data part. But, that's an argument against mobile apps. In Apple's locked down ecosystem I have no control over the data collected. In a web app I can run a blocker, at least.
I care that mobile devices are the general computation devices of this generation and we ceded control of it to Apple and Google then let them add a 30% tax onto it and control what we can run on our computers. If Microsoft did this with Windows applications, we would rightfully call out their anti-competitive behavior.
The common retort at this point is "just don't use a mobile device." That was a valid answer for a while, but particularly with covid, a lot of things became mobile apps with no web alternatives. I had doctor's appointments that required using an application on one of those two platforms.
As a consumer, I also dislike that Apple and Google don't really need to respond to market demands. Changing platforms is a huge upheaval and can be quite costly, since there's really no cross-platform licenses available. You just need to re-purchase all of your apps and any media. They also lock you in with their cloud services. Sure, I could use Dropbox, but Photo shared libraries only work with iCloud. They have a captive audience and get away with a lot that they wouldn't with a competitive marketplace.
I get it. Plenty of people like the gilded Apple path. But, we're well beyond the point of platform being limited to peripherals for Apple enthusiasts. These are primary computing devices that are essentially unavoidable. Switching to Google is an impractical solution and doesn't address the core problem anyway, so that's a non-starter. If the cost of opening up the platform is you can't get Fortnite in the Apple App Store, I can live with that. In the unlikely event Apple...
For this you get nice things like you don’t need to deal with taxes in all the different countries.
This is all their fault.
And I'm perfectly ok with App store developers doing what they are doing and making lots of money. But there is a price tag and they either must be ok with that or like me they'd opt-out.
So I've been 'striking' for as long as I've had App ideas and things that I could have fielded as an App but ended up just putting on the web. I don't need to convince anybody.
It came out in the Epic trial that’s where 90% of the revenue comes from. It’s not from small indy developers
And so by all means withdraw your app but the rest of us will simply continue to pay the 15/30% as we have always done.
You know what the experience was in one word?
Shit.
For both developers and consumers.
Then comes Apple with amazing hardware, software and APIs with focus on developer experience.
Developers decide to ditch side-loading & stuff like xda-developers in favor of 30% fees to develop for iOS (and then Android) because it’s so amazing for them and the consumers.
It got to the stage where developers were so happy with the 30% fee and Apple/Google duopoly, many even didn’t even try to develop anything for other mobile OS’s including the Windows Phone store.
Microsoft tried to fund app developers and spent millions, without much luck.
No modern apps, no consumers, no sales.
Microsoft then had no other option than to admit defeat, write off billions and shut down the era of Windows on mobile phone devices.
Even Epic never released Unreal Engine on Windows Phone, and cries the loudest today about the duopoly they helped to build.
So now you’re saying after abandoning side-loading, agreeing to 30% fees for an access to a worldwide billion people marketplace, suddenly after 15 years it’s terrible and we should go back to side-loading again, because greedy Apple?
macOS has both an app store and sideloading. It works great!
I personally use the app store for apps I don’t know/trust the developer of, because I trust Apple’s diligent vetting regarding data collection etc., and I sideload everything that I do trust, or that Apple “wants to protect me from” for non-security/privacy reasons.
1) Many App Store apps are completely free, paying nothing to Apple except the $99 per year fee, so they have no stake in this issue.
2) My understanding is that more than 90% of developers in the App Store make less than $1 million per year and thus are covered by the Small Business Program, which charges only 15% rather than 30%. Revenue in the App Store is extremely top-heavy, with most going to a relatively small number of the top developers (such as Epic, previously). How much are developers willing to risk just to lower the 15% cut somewhat?
3) Let's be clear, you're talking about a strike. Many developers derive their entire income from the App Store, so withdrawing their apps means no income. A wealthy corporation such as Epic can survive, but what about little indie developers?
4) An individual developer uniterally striking would be futile and self-destructive. Developers would need to be organized and all strike simultaneously.
5) Strikes are very difficult to organize. Forming a union almost always has to come first. And union members typically work together in the same building, which greatly facilitates organization. Whereas there are a huge number of App Store developers scattered all around the world, and they speak different languages. How would you even communicate with all of them to organize? (EDIT: I see in another comment that you think it's easy as spreading cat memes. That's not a serious suggestion.)
I don't see that as a problem.
> 2) My understanding is that more than 90% of developers in the App Store make less than $1 million per year and thus are covered by the Small Business Program, which charges only 15% rather than 30%. Revenue in the App Store is extremely top-heavy, with most going to a relatively small number of the top developers (such as Epic, previously). How much are developers willing to risk just to lower the 15% cut somewhat?
I can't answer that question for any particular developer. But if my PSP charged me 15% I'd be looking for another one and if my PSP arranged for things in such a way that I'd owe them anyway by virtue of developing for a particular piece of hardware that they already sold and made their profits on I'd go and do something else with my time. Which is why pianojacq.com is on the web and free instead of an App in the App store because that way Apple/Google don't get to increase their grip on the market regardless of whether or not it is free. I disagree with their business model to the point that I'm not partaking in it at all.
> 3) Let's be clear, you're talking about a strike. Many developers derive their entire income from the App Store, so withdrawing their apps means no income. A wealthy corporation such as Epic can survive, but what about little indie developers?
What about those poor dockworkers? Any kind of battle with the likes of Apple (or your merchant marine overlord) comes at a price. In some cases people died to fight for their rights. 'little indie developers' are still business owners who will either stand up for their rights or they will have to live with the consequences of not doing so. More likely: those that do stand up for their rights will find themselves kicked out of the App store (monopoly power abuse...) and their competition will thrive.
> 4) An individual developer uniterally striking would be futile and self-destructive. Developers would need to be organized and all strike simultaneously.
Yes, you got it. That's exactly what they should do.
> 5) Strikes are very difficult to organize. Forming a union almost always has to come first. And union members typically work together in the same building, which greatly facilitates organization. Whereas there are a huge number of App Store developers scattered all around the world, and they speak different languages. How would you even communicate with all of them to organize?
I would start with looking for places where App developers congregate and start spreading the message (SO / HN / Reddit / whatever remains of /. / any other forum), write a bunch of press releases and build a movement, then, when the numbers are there for the GADA (the Global Appstore Developer Association) I'd announce the first collective action and take it from there.
It will be work, but so what, if you think it is worth it then it's worth doing well.
As for language barriers and such: there's an app for that...
I can answer for this particular developer. No, it's not worth it for me. There are many huge problems with the App Store, but I personally don't consider the 15% cut to be among the top problems. I could write a long screed about those problems (and I have before), but that would be a bit off topic. I will mention one thing though: I think the "race to the bottom" is a much bigger problem than the cut. I would happily pay a much higher cut if I could charge higher prices for my apps. Just look at the simple math: 85% of $1N = $0.85N < 50% of $2N = $1N. Thus, a 50% cut would be worth it if I could charge twice as much.
Incidentally, I think even for Epic, the 30% cut is not the entirety of the problem. Epic is a cross-platform company, and App Store payments, locked in and controlled by Apple, make it difficult for Epic to do anything cross-platform that includes iOS.
> What about those poor dockworkers?
Well, I'm not poor. I don't need a higher income to survive. Also, going back to the points I already made, it's realistic for dockworkers to organize and all strike simultaneously, because of their much smaller number, geographic congregation, and shared interests.
> In some cases people died to fight for their rights.
You want me to die to slightly improve the App Store? Um, no thanks.
> write a bunch of press releases and build a movement
Oh, is that all?? Write the press releases, and they will come, amirite!
> It will be work, but so what, if you think it is worth it then it's worth doing well.
I've actually tried to organize a boycott of Apple's Feedback Assistant, but it doesn't seem to have been very effective. Organizing is extremely hard, especially a global movement! No, it's nothing like cat memes or Hacker News comments, especially when the stakes are so high.
> As for language barriers and such: there's an app for that...
Give me a break... I wouldn't even trust the apps for doing customer support, much less union organizing.
I suspected as much.
> There are many huge problems with the App Store, but I personally don't consider the 15% cut to be among the top problems.
You and many others like you. Hence the need for solidarity and that's why I don't think it would work. It's hilarious how in the same thread devs like you are being called 'victims' and here you are expounding on how you are going to continue in the relationship unchanged because it suits you just fine.
> I could write a long screed about those problems (and I have before), but that would be a bit off topic.
Fine.
> I will mention one thing though: I think the "race to the bottom" is a much bigger problem than the cut.
Yes, that's why you need to organize. That stops the race to the bottom. This is exactly why strike breakers are looked down upon and why companies used to bring in 'scabs' to break strikes. To push that race to the bottom that much further.
> I would happily pay a much higher cut if I could charge higher prices for my apps.
Of course you would. Because that means more money in your pocket.
> Just look at the simple math: 85% of $1N = $0.85N < 50% of $2N = $1N. Thus, a 50% cut would be worth it if I could charge twice as much.
I think most people on HN have a fairly good intuition about such things.
>> What about those poor dockworkers?
> Well, I'm not poor. I don't need a higher income to survive. Also, going back to the points I already made, it's realistic for dockworkers to organize and all strike simultaneously, because of their much smaller number, geographic congregation, and shared interests.
And because they're not going to stab each other in the back at the first opportunity.
>> In some cases people died to fight for their rights. > You want me to die to slightly improve the App Store? Um, no thanks.
No, definitely not. I don't even want you to be inconvenienced. But you've definitely illustrated why Apple is firmly in the seat of power here and given ample evidence for my thesis that the App store developers are doing it to themselves.
>> write a bunch of press releases and build a movement >Oh, is that all?? Write the press releases, and they will come, amirite!
So, you want it to be easy? I personally don't care enough to do your work for you, and if you don't care either then the work won't get done. But then we can stop sympathizing with App store developers.
> > It will be work, but so what, if you think it is worth it then it's worth doing well. > I've actually tried to organize a boycott of Apple's Feedback Assistant, but it doesn't seem to have been very effective. Organizing is extremely hard, especially a global movement! No, it's nothing like cat memes or Hacker News comments, especially when the stakes are so high.
The stakes are so high because people who should care don't and that includes yourself. Your boycott failed because many people look at that problem just like you look at the fees issue. Without organization you can not solve these issues at all.
> > As for language barriers and such: there's an app for that...
> Give me a break... I wouldn't even trust the apps for doing customer support, much less union organizing.
Forgive me for my failed attempt to injecting some humor into the discussion.
https://news.ycombinator.com/newsguidelines.html
> here you are expounding on how you are going to continue in the relationship unchanged because it suits you just fine.
> Of course you would. Because that means more money in your pocket.
> And because they're not going to stab each other in the back at the first opportunity.
> I don't even want you to be inconvenienced.
> So, you want it to be easy? I personally don't care enough to do your work for you, and if you don't care either then the work won't get done.
> people who should care don't and that includes yourself.
That's how you talk if, as an outsider, you don't want the perspective of an App Store developer. If your desire is just to rip on me for doing it to myself, then you don't need me here to do that; you can accomplish such denigration on your own, in the self-congratulatory, know-it-all fashion that you've been exhibiting.
Organizing masses of individual people around a shared goal against a powerful opponent is one of the hardest tasks in the world. For example, the majority of people in the United States hate both of the two major political parties, and lots of people say, "We should have a third party!", and there are indeed many minor party alternatives, but turning one of those minor parties into a viable alternative to the existing major parties is obviously extremely difficult. It's not that people don't want to, but the barriers to organization are massive and multifarious. Though everyone may have the same vague goal, the devil is in the details. And the costs of defection from the status quo can be significant; as small as they are now, third parties are still blamed as "spoilers" of elections.
Funnily enough, what he's describing is called "price fixing" and is illegal. The "race to the bottom" is competition keeping prices low for consumers and is a feature, not a bug.
I think the difficulty of pirating apps on iOS does help developers. At least I’ve heard that piracy is a big problem on Android.
The main bit is getting people to care.
Reddit management won in the end.
I was on a bunch of small niche subs with 10k users or fewer each
Seems like the giant subs like you're talking about are still running, although they're a lot lower quality now that it's effectively impossible to use Reddit on a phone
And there are only 75,000 Reddit moderators in total. That's vastly smaller than the number of App Store developers.
You're certainly not talking about a strike. A strike is when employees refuse to work. What you're suggesting is that the app developers form a _cartel_, and perform a boycott.
It is also why house brands are a thing.
Also, as some other comment has pointed out, the % Apple takes is from their role as one manager. Ask an actor or sports ball player what happens if they don't pay their manager the % owed.
I just haven't figured out why software devs think they are so special that they don't have to pay to play. I have seen no honest answers to this other than Apple === BAD. Devs are pretty much "all monies are belong to us"
It's some weak sauce weasle wording to say, "you might have some other options". This position seems slanted as heck: working overtime to convince everyone that Walmart puts people through the ringer (true) & is the overwhelming desirable option (false), as if that justifies Apple being an awful squeezer too. As though Patagonia, North Face, Colombia, Gap, Saks 5th Avenue & every other brand only dream getting in the big store, as if they live horrible worthless lives now.
No, there's a ton of ways to sell clothing. Volume is one way to do it, but there's a free market here with lots of possibilities and no one is railroading brands and makers into awful decisions. There are also online only folks who just have their own e-storefronts and/or others. There's so many channels. Apple's App store has a unique in the world today, of dominating a massive sales channel it's customers cannot escape, on one of the most general purpose soft devices on the planet. For basically happening to do their job of building a consumer OS and not a lot more.
(Steam I think is a more interesting case, where they compete freely & without anti-competitive hacks, but still basically are the de-facto middleman.)
If you think a chain that can afford to open its own stores is the same thing as a company making a single thing or even a couple of things, then you're well beyond weasel words and are in a delusional state. Most people make something and need to have it sold at other stores. You've made hell of a leap here to try and call me a weasel
We're talking app makers. The equivalent would be pre-internet days of selling software at computer stores or again big box retailers. Again, your options are limited. If you're an app farm that just shits out clones of other software, you can burn in a fire and I don't care what happens to you.
Just because developers have fallen victim does not mean they should all pull their apps. How would you suggest that all impacted developers go about coordinating such a strike?
Solidarity is very difficult to achieve in a large enough consensus to a point where people would pull their apps.
I always had a mild smile for the tales of the "secure refined Apple store" but seeing the reality has been a bigger shock than I expected. It's a scam haven.
We don’t know what that is, since there currently is no market.
Sure, technically it's still a market, but I wouldn't consider it a remotely efficient one to do price discovery.
Insurance companies have lots of competition, also low profit margins.
Making a top of the line smartphone does not have a lot of competition, hence higher profit margins.
Medicine is patented and hence does not have a lot of competition, also higher profit margins.
If there is another - more popular provider. Isn’t it at the very least a duopoly? Or are we redefining words now?
Whether that’s a market considered relevant from an antitrust point of view is the big question.
At some point a company is just building a feature, and they're not required to make every single feature accomodate every other manufacturer's competing version of the feature. I knew I was buying the Mini system when I bought the car, and I accepted it. Same is true for iPhone users.
"Knowing that you're buying into a monopoly" is generally not a valid defense for a monopolist. The idea is that there can be a disadvantage/harmful impact to market participants even despite their full knowledge of the market structure (which isn't even a given for retail consumers).
But generally, I agree: There are definitely many closed ecosystems/non-competitive "markets" like the ones you describe, and more often than not, regulators don't step in. Who knows, maybe regulators will address that market at some point! The EU DMA doesn't seem to obviously not apply in this scenario, for example.
Several factors for why I'd consider that case to be a bit different though:
- Many car entertainment systems now offer you to connect an iPhone or Android phone and use CarPlay or Android Auto for navigation. You can reasonably use the car's navigation functionality (GPS antenna, voice output, built-in screen that won't hit your head in an accident) without paying the car manufacturer!
- If your car doesn't allow that, or you don't want to use Apple's or Google's solutions, you can stick a physical aftermarket navigation system to your windshield/ventilation grill.
- There isn't a single car maker that controls roughly half of the US market.
You still can't say Apple is a monopoly by being the second most popular in the smartphone OS market...
Toyota is a monopoly for RAV4 manufacture. Can you get a RAV4 from Mercedes? Monopoly!
You can be the most popular and not be a monopoly, but the reverse is definitionally impossible.
> Given the trial record, the Court cannot ultimately conclude that Apple is a monopolist under either federal or state antitrust laws. While the Court finds that Apple enjoys considerable market share of over 55% and extraordinarily high profit margins, these factors alone do not show antitrust conduct. Success is not illegal. The final trial record did not include evidence of other critical factors, such as barriers to entry and conduct decreasing output or decreasing innovation in the relevant market. The Court does not find that it is impossible; only that Epic Games failed in its burden to demonstrate Apple is an illegal monopolist.
> The Court does not find that it is impossible; only that Epic Games failed in its burden to demonstrate Apple is an illegal monopolist.
GP made the monopoly comment.
https://ei.com/economists-ink/fall-2021/market-definition-in...
Apple argued from the very beginning that the 30% was its fee for running the App Store, marketing the apps, and storing and delivering the app bundles. The in-app payment system was a convenient way for Apple to collect its commission and a way for Apple to create a unified payment experience for its customers, but it was never the Achilles heel for Apple's business model.
The best case scenario here is that Apple is forced to walk back some of the more onerous requirements they've imposed for whether and how links may be shown. Them putting a price on the payment processor portion of the fee and discounting developers for that portion was inevitable and isn't even malicious compliance, the judge explicitly called this out as a likely outcome in the original ruling:
> First, and most significant, as discussed in the findings of facts, IAP is the method by which Apple collects its licensing fee from developers for the use of Apple’s intellectual property. Even in the absence of IAP, Apple could still charge a commission on developers. It would simply be more difficult for Apple to collect that commission.
> In such a hypothetical world, developers could potentially avoid the commission while benefitting from Apple's innovation and intellectual property free of charge. The Court presumes that in such circumstances that Apple may rely on imposing and utilizing a contractual right to audit developers annual accounting to ensure compliance with its commissions, among other methods. Of course, any alternatives to IAP (including the foregoing) would seemingly impose both increased monetary and time costs to both Apple and the developers.
https://casetext.com/case/epic-games-inc-v-apple-inc-2
Is it just me or does this argument seem insanely flimsy? If Apple were serious about it then why aren't they charging free apps for downloads and approvals? Why doesn't the developer policy require Netflix to pay 30% of subscriptions for anyone who signs in on an Apple device? Why are the prices lower for "reader" apps who presumably cause Apple to incur similar costs?
Its like a toll road arguing "no, driving on the road is free of course, we just charge at the entrance and exit for the privilege of looking at the toll road".
What does it take for the legal system to be able to call BS on a claim like that?
Some apps don't make any money at all, and Apple wants to let those exist and so they get a free pass. For others, Apple is only providing a tiny portion of the value of the app, most of it comes from the content that the app licenses from other companies. Apple recognizes that they can't take 30% from those apps without them giving up on an app entirely, so they get a discount in order for them to stay on the platform.
Is it fair? Probably not. But I see no reason to believe it's illegal.
If they take it too far, that's how you get into antitrust territory. That's why Epic's court case against Google ruled in Epic's favor, as it was giving paying off devs to not make their own app stores and blocked OEMs from making deals with other studios.
So I'd say this puts apple on thin ground. I'm sure this won't be the last high profile lawsuit over the app store this decade.
Where I imagine Apple could get into trouble is if they systematically turned a blind eye to commission-dodging by specific entities as part of a trade to ensure their market dominance. Unlike Google, though, I'm not even sure which entities Apple could bribe that would risk looking like a trust.
Like any discrimination case, it depends on the subject of discrimination and potential victims. So I would say that discriminating with the largest streaming service can be a way to lock out the rest of that market from competing properly.
>Where I imagine Apple could get into trouble is if they systematically turned a blind eye to commission-dodging by specific entities as part of a trade to ensure their market dominance
Yeah, that's what I'm getting at. There's no hard evidence but that's what would be subpoena'd in court.
Ironically enough, Google is the biggest smoke signal here. Since court cases reveal they have some sort of deal with Apple to power search. That deal + potential discrimination with Google submitted apps can lead to those exact issues Google is under fire for.
Google essentially pressured and bullied OEMs and other third parties into doing stuff that was beneficial to Google in exchange for licenses and special deals.
At that point, you’re throwing your weight around, something that Google “had” to do because they started with a relatively open platform.
Apple, on the other hand, preempted needing such tactics by making their ecosystem closed and heavily regulated from the onset when they were still nobodies within the market. That makes it extremely difficult to prove antitrust issues.
Had Apple, say, increased the commission from 30% to 33%, then it would’ve been pretty close to an open and shut case because then it’s easy to argue that Apple threw its weight around once everyone was inside the ecosystem. But the opposite happened.
This is also one of the reasons why everything Apple does is restricted and limited from the onset. It’s always easy to loosen the reigns later, but at their size, you can never go the other way without risking antitrust liability.
FWIW, even MS, with their egregious behavior, got a lot thrown out on appeals and prevented being split up. The DOJ ended up settling instead.
I mean, there's actually many toll roads/bridges that only charge for travel in one direction. The other is free, with the expectation that you'll need to make a return trip anyways.
Apple being entitled to a commission regardless of who you use as a payment processor is literally part of the court ruling.
The court did not find that the size of the commission was necessarily justified, but they definitely ruled that a commission was justified.
Obviously if they tried to charge 85% no one would actually be a developer and the App Store would crater. So they have a very strong incentive not to.
But from a legal point of view is there a reason why one number would be legal but another wouldn’t?
The only thing I can think of is a contract being determined to be unconscionable. Until they hit whatever threshold that is it seems like it’s completely up to them to set the terms at whatever they think enough developers will accept.
That's not really true. If the iPhone became a real monopoly in the US, for instance, with perhaps 98% marketshare (similar to Windows before Macs started seriously challenging them), then Apple really could charge 85%. What is anyone going to do about it? They'd have a choice of paying 85% to Apple so they can sell apps to 98% smartphone users (basically everyone), or not selling smartphone apps altogether and finding a new business strategy that probably doesn't involve making software for consumers at all (which admittedly, many developers would probably choose).
I think the missing piece that most people miss is that it is not illegal to have a monopoly. It's illegal to use your monopoly to bully others. Apple did no such thing.
I'm not sure if it is just you, but both the district court and appellate court are on board with it. And honestly, I can see why.
Apple argued that they provide a bunch of services and access to their IP in exchange for $99/year and a commission over the sales.
The courts have deemed that an acceptable business model.
The district court was hemming and hawing a bit over the actual commission rate being set at 30% (15% for small devs) and at the fact that some developers essentially subsidize others but ultimately didn’t make a ruling on any of that in part because Epic didn’t bring it up as an argument.
The appellate court, however, went a step further and stated in no uncertain terms that it was kosher.
If you think about it, it makes sense. We see similar business models with differential pricing all over in commerce for various reasons.
Sometimes, it’s for goodwill, sometimes, to reach customers that would otherwise be harder to convert into a sale, sometimes, it’s based on usage and who puts the most strain on a system and sometimes, it’s for more egalitarian reasons.
Military discounts, student discounts or even free usage, senior discounts, teacher discounts, first responders, etc. These are all examples of differential pricing.
In particular, the student stuff is interesting because the philosophy there seems to be that as long as you don’t make revenue from it (commercial use), “we” don’t need to make a profit from you.
> It’s like a toll road arguing "no, driving on the road is free of course, we just charge at the entrance and exit for the privilege of looking at the toll road".
I don’t think the analogy is apt, but we see similar stuff on toll bridges. I’ve got a bridge near me where toll rates are based on vehicle type and axles.
While the pricing is slightly higher for commercial vehicles (e.g., trucks), it’s not proportional to the increased cost of upkeep those vehicles cause.
Edit: Also realized that only one direction is burdened with tolls. The other way isn't.
> What does it take for the legal system to be able to call BS on a claim like that?
A very carefully crafted legislative change, I suppose, if possible at all.
Currently, with SCOTUS’ refusal to take up the case, this is standing law, and it’s challenging to craft legislation that wouldn’t have reverberating effects across all of commerce while simultaneously only hitting Apple.
I mostly just find it silly that at no point does anyone seem to address the elephant in the room that the only way to access some hundreds of millions of users is through Apple, and that almost certainly influences the fee in a way that can't be really be explained by the value of the IP.
Does the argument require us to believe the fee would still be 30% if iPhone had practically zero users? Or is that legally irrelevant assuming that they aren't found a monopoly?
While not zero users, the default fee has been set at 30% since the beginning of the App Store, long before Apple had the level of market dominance it has today.
This argues in favor of it being acceptable: developers were willing to accept that fee without monopoly pressure being applied, since nobody has successfully argued that Apple held a monopoly in 2008.
A class of digital native judges.
The App Store sucks. That’s its problem. 30% fees rub salt in that wound.
Name an Apple application you aren’t forced to use that you like. Notes? Final Cut? That’s all I can think of.
The whole paradigm of iOS is predicated on a 65yo+ consumer who doesn’t know any better, and happens to be also the demographics of the government.
The other popular apps are front end for services where Apple doesn’t collect a dime like Facebook, Instagram, Netflix, etc.
Especially in the US, how likely is it do you really think iPhone users are going to sully themselves and buy Android phones when many people think that “only poor people buy Android phones”. (Note sarcasm)
It is an interesting question that I would love an answer beyond a hunch.
I would think a larger percentage would stay on iPhone and look for an insta alternative, compared to the percentage who might move on to a different phone for insta.
But what would those numbers look like? Any case studies or similar changes? Maybe in game consoles?
https://gitnux.org/android-vs-iphone-statistics/#:~:text=In%....
> In Q2 2021, the average selling price of an Android smartphone was $269, while the average selling price of an iPhone was $729.
The district court was crystal clear about this in their judgment, which at the time caused quite some consternation.
The appellate court then affirmed the same and even clarified more clearly that it’s completely fine because it primarily is the mechanic Apple gets payment for the use of their IP and, secondly, their services that encompass more than just payment processing.
In fact, if you read the appellate judgment, the annoyance towards the district court is palpable.
The annoyance stems from the fact that the district court states in their judgment that alternative ways of collecting the commission aren’t worth considering and expanding on because of how onerous they are (retroactive audit, collection efforts, etc.) while at the same time causing exactly that by striking the anti-steering provision and opening the door to third-party payment providers.
The appellate court doesn’t go further than expressing annoyance between the lines because, ultimately, the district court didn’t err substantially enough for the appellate court to step in, which is ultimately the bar that needs to be met. Appellate courts aren’t meant to relitigate cases, after all.
Or will everything stand as it is at the moment with figuring out specific details that Apple must abide by that haven’t already been listed up to future lawsuits to determine?
So as it stands, the appellate court’s decision is the law of the land.
Technically, from a legal perspective, there is a small chance this changes if a case makes it way to an appellate court in a different circuit and they’re in the mood to come to a different conclusion, at which time SCOTUS might be inclined to take up that case to resolve the contradictory outcomes, but those are pretty slim for a couple of reasons.
One, it’s not likely a new case would play out outside of California, by virtue of Apple being located there.
Two, a court of appeals of a different circuit would need to be in the mood to completely disregard the 9th circuits conclusion. While technically an option, most appellate courts don’t want to contradict their sister circuit, but there are some “activist” courts out there.
Three, the outcome needs to be sufficiently different for it to cause a significant contradiction.
And lastly, the fact pattern of the new case would need to be extremely similar to the Epic v Apple case.
This completely ignores Apple's market power though. Because what stops Apple from making this 40% or 50%? 30% is a fair price? Look what they did to Spotify with Apple Music. They absolutely abused their ownership of the platform to stifle a competitor.
Also, things change when you effectively become a utility. Apple shouldn't be able to hide behind their "aww shucks, we need the 30% to keep the lights on" routine.
Competitive pressure. 30% is pretty in line with what other platforms charge.
Apple has had the same 30% ever since it launched the App Store, back when it was much less dominant. They presumably picked it as a level that would make revenue but also not deter developers.
The App Store hasn’t got a monopoly on computing.
There’s no world in which Nintendo and apple are colluding to set rates.
What makes you say that? And short of direct collusion, is it fair game if Apple sets the precedent and Nintendo follows suit without direct coordination? If the agreement is only alluded to without being directly stated, are we okay with the ethical precedent regardless of legal standing?
They picked 30% because that was the iTunes Music Store cut. The iOS App Store was a direct clone of the iTunes Music Store in almost every way. It even existed inside iTunes for years. As a developer, I can still see "iTunes Connect" in some obscure areas of App Store Connect.
The documents from the Epic trial showed that the App Store was thrown together very quickly. Initially, Steve Jobs didn't even want third-party apps on iPhone and had to be convinced to add them.
Plausibly iTunes 30% was chosen because it met the same goal: high enough to earn a good amount, low enough music companies found it compelling.
I've never understood why video game consoles are the relevant platform. iOS is a general-purpose computing platform more akin to Mac and Windows. Indeed, iOS was based on Mac OS X. As an Apple user, I don't even play video games, on either iPhone or Mac. And as an Apple developer, I don't write video games either. Games are 100% irrelevant to my computing life.
> Plausibly iTunes 30% was chosen because it met the same goal: high enough to earn a good amount, low enough music companies found it compelling.
The problem is that the iTunes Music Store was based on selling 99 cent songs. 30% of that is just 30 cents. Before the App Store, computer software was almost never in the 99 cent price range.
From the courts’ perspective, it isn’t. The relevant market definition, as established by the courts, is digital mobile gaming transactions.
I’ve called into the District Court’s hearings almost every day, and many days were spent on determining the relevant market, but the long and short of it is that this definition was chosen because:
- The impetus of the case was Fortnite - Epic was unconvincing in establishing their EGS was more than just a gaming storefront, which limited the scope of the case to gaming - the court established that free-to-play games generated the vast majority of the App Store revenue
You also have to remember that the court can’t just hand out judgments that affect things beyond the case in front of it. This case was Epic v Apple and not, say, a class action by multiple app developers, so the court's conclusions will be limited to the facts that pertain to those two parties.
In other words, other markets might exist, but they might not be relevant to the case at hand.
Additionally, civil courts prefer to split the baby; in this case, this seems to be a middle ground between Apple’s proposed relevant market (games in general) and Epic’s (Apple’s App Store).
An interesting tidbit is that Nintendo’s Switch made a minor cameo of sorts because you can make transactions on it on the go (i.e., it's mobile). Still, the main competitor, according to the court, was Google, leading the court to conclude that Apple is primarily in a duopoly with Google.
Personally, I think video game consoles would be part of the relevant market because of the similarities in market dynamics. The way the payment for IP is structured (commission), the way entry to the market is managed (certifications, similar to app review), the way there’s a single brand market (i.e., monopoly by manufacturers), etc.
While the purpose of the devices might be different, the underlying products are the same (software), and the market mechanics are nearly identical. Even the platform limitations are artificially created by the platform holder (i.e., what you can and can’t do on iOS is artificially limited, just like what you can and can’t do on consoles is artificially limited by Sony and Microsoft).
Drilling it down further, you’ll find that on Xbox, you have access to non-gaming apps, and plenty of people use their iPads as a game device for their kids. Further blurring these lines of purpose.
> As an Apple user, I don't even play video games, on either iPhone or Mac
You might not, but it wouldn’t come as a surprise to you that others might. I, for example, play games on my Apple devices, as do others in my household.
> And as an Apple developer, I don't write video games either.
Same here. I mainly write apps, but I dabble in games and know plenty of other devs who make games.
> Games are 100% irrelevant to my computing life.
What I’m trying to say is that anecdotal arguments aren’t solid. This is not a dig at you; mine aren’t either.
> The problem is that the iTunes Music Store was based on selling 99 cent songs. 30% of that is just 30 cents.
I don’t follow this logic.
Does it matter if $300,000 is extracted via a million $1 transactions or 10,000 $100 transactions?
Ultimately, you end up paying $300,000 in commissions.
> Before the App Store, computer software was almost never in the 99 cent price range.
There’s a lot to unpack with this simple statement.
First is, of course, that the race to the bottom is a pro-competitive symptom.
If we, as devs, didn’t have to compete so hard, we wouldn’t have to sell our software at low prices. Ironically, this is good for consumers, but the devaluation of software isn’t so great for us developers.
Secondly, this, of course, undermines your iTunes $0.99 argument. Whatever it used to be, it’s now the same as with songs via iTunes. Does this mean you’re ok with the 30% commission or ...
Let me start with this, because it may clarify a lot. I qualify for the Small Business Program 15%, and while I think that Apple's developer services are totally crappy and not even worth 15%, from my perspective the cut is not among the App Store's biggest problems, and I would happily pay an even larger cut if I actually got a good return for the investment.
My goal was merely to highlight the historical origin of the App Store, which is important in understanding how we got to this point today.
> The relevant market definition, as established by the courts, is digital mobile gaming transactions.
As invented out of thin air by Yvonne Gonzalez Rogers. But I'm not really interested in arguing the legalisms. I think the decision was bad, but that's par for the course in our legal system. I'm more interested in the public debate over the issue, here on Hacker News, on social media, in the news media, etc. Regardless of what the judge decided, the people in the public who defend Apple often point to gaming consoles and consider them to be the relevant platform.
> What I’m trying to say is that anecdotal arguments aren’t solid. This is not a dig at you; mine aren’t either.
I'm not sure what you think I was arguing, but it was simply that iPhone is a general-purpose computing device. Of course gaming is one of those purposes but definitely not the only purpose. Indeed I would argue that gaming is not even the main purpose, because after all, iPhone shipped in 2007 with zero games, and while Apple has created a lot of apps for iPhone, Apple has created almost no games for iPhone. (I think they had a Texas Hold'em game way back in the day, and they also made Warren Buffett's Paper Wizard.) I wasn't trying to deny that people use iPhone for gaming; that would be a silly argument.
You can argue that gaming consoles have some additional capabilities besides games, but does anyone ever buy a gaming console who doesn't play games at all? That would be silly and pointless. Yet huge numbers of people buy iPhones and iPads and Macs with no desire to game on them. Thus, I argue that those are general-purpose computing devices, unlike gaming consoles.
> Does it matter if $300,000 is extracted via a million $1 transactions or 10,000 $100 transactions?
Yes. 30 cents is actually a very good deal for a 99 cent transaction. I don't think you'll find a better one, and many payment processors would charge 30 cents plus a percentage. At least as far as payment processing is concerned, though, 30% is a crappy deal for a $100 transaction. So the question is, how much does the App Store add to the value above and beyond payment processing? I would argue, not much in most cases.
> Ironically, this is good for consumers, but the devaluation of software isn’t so great for us developers.
I dispute that it's good for consumers. You get a different type of software in a race-to-the-bottom market. When the platform makes it difficult for developers to produce quality, well-crafted, sustainable software, you get exploitative crap instead, and I think the epithet "crap store" is richly deserved.
You can really see the difference in the Mac App Store, because on the Mac, developers don't have to be in the App Store, and quite a few important apps are missing entirely.
It didn't have to be that way. The iTunes Music Store model was a very poor fit for software. For example, the "top charts", based on unit sales, was one of the main ways to get noticed in the App Store and was a big reason for the race to the bottom. The top charts are tolerable for music, where every song and album is more or less the same price, but it doesn't work well for software, t...
> I qualify for the Small Business Program 15%, and while I think that Apple's developer services are totally crappy and not even worth 15%, from my perspective the cut is not among the App Store's biggest problems, and I would happily pay an even larger cut if I actually got a good return for the investment.
I’m sorry you’re unhappy with the services and tools offered in exchange for the commission.
As I stated before, I was already happy with what I got for 30%, the 15% is a cherry on top for me.
I’m one of the few (it seems) that’s very happy with Xcode and its improvements, I’m also very happy with the advancements made on frameworks and SDKs over the last decade or so. It has made my work so much easier and without many of the latest improvements much of what I currently do wouldn’t be possible.
Code level DST support has also proven to be invaluable to me.
> As invented out of thin air by Yvonne Gonzalez Rogers. But I'm not really interested in arguing the legalisms. I think the decision was bad, but that's par for the course in our legal system. I'm more interested in the public debate over the issue, here on Hacker News, on social media, in the news media, etc. Regardless of what the judge decided, the people in the public who defend Apple often point to gaming consoles and consider them to be the relevant platform.
It’s not invented out of thin air, but based on well established case law and legal principles.
I used to practice law between my original stint in software and my current career in software and based on my legal knowledge I’d say that both the original judgment as well as the affirmation by the appellate court is a logical and sound legal conclusion.
But I understand that you’re mainly interested in the “every man’s discussion”, that’s fine.
> I'm not sure what you think I was arguing, but it was simply that iPhone is a general-purpose computing device.
I’ve addressed this both from a legal perspective as well as my personal perspective.
I think it’s safe to say that no new insights can be gleaned from a back and forth and we just fundamentally differ in our views on this.
> Yes. 30 cents is actually a very good deal for a 99 cent transaction. I don't think you'll find a better one, and many payment processors would charge 30 cents plus a percentage. At least as far as payment processing is concerned, though, 30% is a crappy deal for a $100 transaction.
I don’t think it makes much of a difference when taking volume into account. The “pain” is the same, it’s only a matter of difference to how it feels.
> So the question is, how much does the App Store add to the value above and beyond payment processing? I would argue, not much in most cases.
Perhaps not with that framing, I’d argue the question is really how much does Apple as a company add to the value as the commission structure first and foremost serves as payment for being able to use their IP.
The answer is easily found I’d say, try and reinvent the wheel for yourself, leave as many frameworks to the side and let me know how it goes.
For me SwiftUI alone is worth its weight in gold given how much time it has saved me.
> I dispute that it's good for consumers. You get a different type of software in a race-to-the-bottom market. When the platform makes it difficult for developers to produce quality, well-crafted, sustainable software, you get exploitative crap instead, and I think the epithet "crap store" is richly deserved.
I don’t agree with you on this either. I’d argue that the golden age of apps is here, if only because of the many high quality indie apps.
Something that would’ve been impossible without the available tools and frameworks, something that was completely absent in the software market decades ago.
> 30% of $100 is $30. 70% of $0.99 is $0.69. I'll happily take the...
> Code level DST support has also proven to be invaluable to me.
You're talking about things that have nothing to do with the App Store. These same tools are used by Apple to make their built-in software. They're also used by Mac developers outside the Mac App Store.
I'm talking about the App Store itself, as well as tools and services directly related to the App Store, such as App Store Connect.
> The answer is easily found I’d say, try and reinvent the wheel for yourself, leave as many frameworks to the side and let me know how it goes.
> For me SwiftUI alone is worth its weight in gold given how much time it has saved me.
Again, you're talking about things that have nothing directly to do with the App Store. The iOS and macOS system frameworks are not the App Store and would exist even if the App Store were eliminated.
> Something that would’ve been impossible without the available tools and frameworks, something that was completely absent in the software market decades ago.
Same thing here. Nothing to do with the App Store. And in any case, they were available decades ago. Xcode is 20 years old. UIKit is based on AppKit, which itself originally came from NeXTSTEP over 30 years ago.
> But pushing 100 units at $100, leaving you with $300 is less than pushing 1000 units at $0.99 leaving you with $690 and that’s a conservative estimate.
Your math is wrong. 100 x $30 = $3000, not $300.
Anyway, indie developers can't "make it up in volume". One of the most difficult things for an indie developer is marketing and getting discovered by customers. That's why we need sustainable prices. Not to mention paid upgrades.
> You can choose to ignore that part, but that doesn't change the fact that everyone and their mom was cheering for a 30% haircut and a simple publishing process after having gone through hell with carriers.
Was the pre-iPhone mobile software market even as big as the Mac software market? I'm skeptical. It certainly wasn't as big as the Windows software market, which is also open. Open platforms were the norm.
Market. It's capitalism, you know.
They provide users to devs (e.g. in case of Epic most people played Fortnite from iOS) and they provide apps to users. If they jack up the price and devs quit, the deal stops being attractive to users because there's not enough apps so Apple risks losing users unless they make selling apps appealing to devs again.
> Look what they did to Spotify with Apple Music. They absolutely abused their ownership of the platform to stifle a competitor.
Everyone I know on iPhone is using Spotify except me so for me it is hard to see who is stifled exactly...
There is no current iOS version of Fortnite. The only way to do it is with Amazon Luna or Xbox Cloud Gaming, which is only "playing Fortnite from iOS" on the very surface.
It's not there anymore but it was there originally. (It'd be amazing if it still were. If you were allowing me to sell my game in your store for a fee, and I stopped paying the fee AND sued you, you'd remove me from the store first thing. First to avoid funding my legal expenses and second because I agreed to your ToS that allow you to do it literally for any reason you like.)
After it was removed, Epic found out that people who were casually playing Fortnite on iOS were not about to start buying PCs and gaming consoles. After all there are other games in the store, including tons of buy-once-play-forever games which don't leech money off you or your kids like Fortnite does.
> More than 116 million registered users have accessed Fortnite through iOS -- more than through any other platform, Epic said in the filing
https://www.bnnbloomberg.ca/fortnite-users-flee-after-gettin...
Market power has little to do with the legality of a business model at first blush. Only in very narrow circumstances might it be a relevant factor.
In this case, market power doesn’t matter at all, no matter which angle you approach it with.
For starters, fundamentally, market power doesn’t preclude a company from extracting payment in exchange for their services and IP. This is what both courts explicitly (re)affirmed.
And that makes sense, of course; just because you’re big doesn’t mean you can be forced to give your stuff away for free.
From an antitrust angle, market power mainly starts to matter once you abuse that market power. Here, all signs on the commission point the opposite way.
Apple introduced the 30% commission and the strict App Store rules around the same time the App Store was launched, at which point they had no relevant market power to speak of, so that was not an antitrust issue.
The parties quibbled a bit about at which point Apple gained market dominance because that’s a relevant measuring point to establish antitrust issues. Still, regardless of wherever you place that starting point, it is clear that Apple didn’t use that market power to turn on the screws.
They didn’t, say, increase the commission or impose more onerous restrictions. The opposite happened.
They first introduced a commission discount of 15% for subscriptions after the first year, and later on, they introduced the small business program that provides a 15% reduction to developers with less than $1M in revenue, which, as I understand it to be, covers about 90% of the developers.
These moves, whether for altruistic reasons, goodwill reasons, or fear of regulatory action, are the opposite of abusing one’s market power.
I think that Apple is quite aware of this risk, which is why they always introduce things minimally and strictly, because that gives them the option to assess and decide to loosen up things, whereas the opposite isn’t possible; they can’t impose more restrictions due to the potential antitrust issues at their current size.
Moreover, courts aren’t eager to retroactively punish just based on success.
The way the courts see it, it’s almost self-evident that Apple wasn’t acting in an anti-competitive way with their commission.
From their perspective, if Apple was able to enter a market as a nobody (or create it even, if that’s how you want to look at it) with such restrictive rules and with a commission rate that is now considered high (even though it was a significantly lower commission than what was standard at the time) and still managed to capture a good chunk of the market as they did, then there must be pro-competitive forces at play, even when it’s hard to quantify them.
Again, the way they see it, if it all were so terrible, then nobody would’ve signed up for it in the first place. So, there had to be a pro-competitive benefit that outweighed all of those negatives.
> Because what stops Apple from making this 40% or 50%? 30% is a fair price?
Competition in the relevant markets as defined by the court? Antitrust violations? Pick your poison.
Courts generally don’t care much for hypotheticals because hypotheticals can’t be remedied, and it doesn’t feel good to dole out punishments for things that could be.
Courts tend to limit themselves to what has happened instead of what could happen.
That’s not to say they don’t look at it at all. In this specific case, they’ve looked at the competitive effects and what would stop Apple from doing X, Y, and Z in their test to establish how much competitive pressure Apple is under to understand the motivations behind some of Apple’s actions.
But ultimately, unless Apple does the thing you fear, they can’t punish it.
> Look what they did to Spotify with Apple Music. They absolutely abused their ownership of the platform to stifle a competitor.
I’m looking, but I don’t see much. Of course, t...
The cost of operating an App Store and providing distribution is relatively negligible. Several Linux distros have app stores, and package management and distribution systems that are as good or superior than Apple’s.
The annual fee that Apple charges developers alone should more than cover the cost of App Store. It is not something that costs tens of billions of dollars.
Just based on your quote and without having much interest in the case... the fee isn't about covering costs. They have an app store, people want to be in the app store, and Apple is going to charge them a fee to be in the app store. Similar logic to drawing a wage.
This is bad analogy. A person who works provides services or labor worth a certain amount of value in exchange. Often that value exceeds the wage. For example, a software engineer $3000 "worth" of work in a day, but only gets paid around $1000 for that day. I understand the worth/value is a difficult thing to measure.
In Apple's, they provide almost nothing of value in exchange, other than the threat to kick your app out of the App Store: https://www.theverge.com/2020/8/13/21366438/apple-fortnite-i...
So Apple is more like the Mafia. The threaten negative/adverse action, if you don't pay them.
Also, historically, software could be installed on computers without the permission of an overlord. I'm aware iOS & game consoles are glaring exceptions.
And the argument that Apple is like the Mafia because they can exclude you from something would cast most businesses and all landlords as Mafia-like. That is a position some people hold, but if mafiadom is so embedded and accepted in society it undermines the idea that Apple's is a unique problem and that it will be acted on.
> running the App Store, marketing the apps
What marketing specifically? Last time I checked, I had to integrate third party ad experiences in order to market my app in their ecosystem.
> In such a hypothetical world, developers could potentially avoid the commission while benefitting from Apple's innovation and intellectual property free of charge.
> Apple argued from the very beginning that the 30% was its fee for running the App Store, marketing the apps, and storing and delivering the app bundles
With hindsight of the antitrust case in the EU this argument itself seems like it is in bad faith. Apples argument in the EU against antitrust was that there isn't one but five different app stores, conveniently for each device family.
So they are indeed aware that a commercial app developer would likely not be "benefitting from Apple's innovation and intellectual property free of charge", because they are likely not taking advantage of their entire catalogue of intellectual property (if there is five different app stores, for five different markets, as per Apples argument, surely there is different IP between those markets to run the app store in an effective manner).
In other words, as others have mentioned, Apple charges a 30% flat fee for "intellectual property" that developers may or may not take advantage of, as per their own argument overseas. I don't see how it's not antitrust when a company forces me to pay for services that I am not taking advantage off or ever had the intent of using, or can't use, due to technical limitations.
As a developer, to me it rather feels like Apple is trying to artificially bind me to invest into the app store as a platform due to this high fee, for example by developing an accompanying watch applet or a tablet version of my app, because the act of simply offering these on their devices seems to be part of their precious App Store IP. And you can't argue that pricing these add-on apps differently would make a difference for Apple, since they collect the 30% cut across income in their entire ecosystem either way.
It also doesn't make sense for Apple to tell me to go elsewhere (Android) to mitigate this, as I can't replicate the UX of their ecosystem on my own even if I tried (prime example would be the peripheral integration imo. You'll find creating a device that integrates as seamlessly as the Apple Watch fairly hard, not because Apple has some special proprietary integration IP secret sauce, but because they artificially lock down ways to interface with peripherals to secure market dominance).
To this day it remains absolutely unbelievable to me that anyone would ever agree to this. I always have and always will tell Apple to shove their app store up their ass. Plenty of other ways to make a living in software.
And grocery stores are not even considered a monopoly!
Edit: which is not say that there should be an "is" vs. "ought" conflation. Just that it's unlikely that this situation is going to be changed through courts. Other routes: legislation and regulation to establish a new social norm, or as Jacquesm has been advocating here, collective bargaining. But as an App Store consumer, and a developer of other sorts of tools, I don't really care at all about the developer-Apple split and am not the least bit excited by whatever might happen should that switch to, say, 99% going to the developer. Even if developers dropped prices 30%, I would have a hard time caring!
The analogy would work better if the grocery store sold me some sort of platform for cooking food, that only worked with certain types of food... I don't know, it's hard to find the analogy compelling at all.
People develop for the App Store because they get access to a particular customer base. I could definitely support some sort of customer protection that forces side loading options (but they must be options and easy to disable and hard to enable, otherwise it destroys one of the best aspects of the phone.) But as far as caring for slight changes in percentages for app developers, well, I don't care about that one bit at all, anymore than I care about Apple getting a "fair" deal from the other businesses it interacts with.
this is what happens when the company controls their platform. In the technical sense, it's not monopoly, but surely if you squint a bit, it looks like it.
This is why i am only ever going to produce web based apps. I will not buy into a platform - even android has the same issue, albeit less severe (only because google does not completely control the android ecosystem).
"If you don't like it then alternative is your target market is cut by over 50%"
Not a great argument. When you essentially have the say as to whether a company can afford to exist then you have serious control over a "free" market.
Does Apple have the manpower to chase every developer for that fee? Do they really expect to collect it or is it more of a threat?
Any HN people with first hand knowledge of a business paying that fee?
There's no firsthand knowledge because this is the first time Apple's actually had to chase companies for the fee. In fact, their whole argument against Epic was that banning steering made it easier on both parties to attribute revenue.
> In accordance with the entitlement agreement, the link may inform users about where and how to purchase those in-app purchase items, and the fact that such items may be available for a comparatively lower price
The fact that you must apply for permission to tell your users that you even have off-app purchase items is bullshit.
Apple’s welcome to make the rules of their own platform (within reason), but it’s garbage that developers aren’t even able to say the rules exist. If Apple believes they’re so right and just, why must they leave users uninformed?
What’s the good faith argument for any of this? I want to see Craig Federighi on stage at WWDC announcing and this revolutionary new "link" API, demoing how great the scary warning screens are.
And FWIW, I'm an Apple fan and find Tim S a completely unsympathetic character. But seeing the hilariously absurd lengths that people will go to justify Apple's outrageous greed grows old.
That part of this outcome was inevitable, and I don't think any court will rule against it. It was even anticipated in the original ruling:
> First, and most significant, as discussed in the findings of facts, IAP is the method by which Apple collects its licensing fee from developers for the use of Apple’s intellectual property. Even in the absence of IAP, Apple could still charge a commission on developers. It would simply be more difficult for Apple to collect that commission.
So charge developers for the service of using the App Store, perhaps with a per-download cost. To "give away" the service of the App Store only to recuperate your costs (and then some) via payment processing is just daylight robbery.
Charging customers by some other correlated proxy is not robbery; it’s just practical. Which is exactly why the court had no issues with the arrangement.
Given that this is the US legal/political system, that question is being fought out in various proxy fights, but by looking at the largely equivalent situation in the EU and the DMA, you can see what’s really at stake here.
The idea wasn't to use third party processors as an argument to evade the fee, it was the other way round. Front and center Epic wanted to get rid of or strongly lower the fee, and as a consequence developers would probably have had to use other processors.
The judge shut this down by legitimizing Apple's 30%, which as a consequent allows Apple to collect that money however the dev processes their customers, third party PSP or not.
That only works if developers actually could save significant money by selling through alternate storefronts, which was never going to be possible because Apple was always going to pick something approximately market rate as their valuation for the payment processor portion of the fee.
[0] https://news.ycombinator.com/item?id=39014642
For example:
> It seems easy to kind of shrug at this, but this does seem quite significant because of many mobile apps are 'free to play.' Apple pocketing 30% of all of these transactions, and forcing users/devs to go through Apple, is a major part of its revenue. And all of those apps now have the option to direct users to alternative payment methods, where they can both charge users substantially less and make more profit doing so.
Define greed. Seriously, I'm asking for an objective definition, not just ipse dixit.
They're charging what the market will bear for a _vastly_ better product (iOS vs. Android).
It’s just not an apples to oranges comparison: One vendor is forcing use of their distribution services; the other just strongly nudges their customers to stay within their walled garden and not enable sideloading.
Apple is in good company in this category.
I wonder how you see Qualcomm, being the crushing leader of mobile modem chips.
In many countries, antitrust regulators set some limits to how far companies can take their “take it or leave it” approach and in many cases require companies to provide a certain service, sometimes even at a certain rate.
Forcing companies to unbundle products or services is another common measure.
I'm not really though. I need to use either an Apple or a Google phone to participate in society.
Heh, there are still folks who actually grasp nuance… I have an iPhone, despise Apple in general, but consider their business disputes on a case-by-case basis. So for example, Apple is right to ignore Facebook’s plea to be allowed to track users, and simultaneously wrong in its App Store monopolistic money-grabbing.
Given the scary things Samsung gets away with in South Korea, I almost want to say they're worse than Apple.
Developer puts out ads on Facebook (or some other way of getting traffic). Traffic flows to the developer's checkout page, where they buy access to in app content on an external website. Then they are linked to the app store where they can download the app and access the content.
Apple is paid no commission on this transaction. They only require commissions paid when the customer is sent to the website FROM the app store and checks out within 7 days.
If this is in fact true, then payment / support service recommendations would be great to hear right now!!
I often wonder had Apple lowered their In-App purchase to 10% would we still have the same problem.
The fact that they have a browser and allow “3p browsers” is only because the web was already established and customers wouldn’t have bought in without it.
iPhones and iPads are not general purpose computing devices. Not by tech, but by policy.
https://krausefx.com/blog/announcing-inappbrowsercom-see-wha...
I always thought that a company should make an app those does something trivially, but also has its own in app browser as the true functionality.
Making things proprietary when they should be commodities is a step backward, and we should fight that, tooth and nail.